Canadian crypto miner Bitfarms is planning a huge new bitcoin mining site in Argentina

An employee inspects machines for the production of bitcoins and lightcoins at the “Kriptounivers” (CryptoUniverse) mining centre.

OLGA MALTSEVA/AFP via Getty Images)

Canadian bitcoin mining company Bitfarms said late on Monday it is planning a new bitcoin mining site in Argentina that will be its largest yet.

The eight-year deal supplies Bitfarms with 210 Megawatt of electricity, at a price of $0.02 per kilowatt per hour in the first four years. In a statement, Bitfarms said this will be enough electricity to create revenues of around $650 million or 11,774 Bitcoin. This is however dependent on what happens with the bitcoin price over that time.

Bitfarms currently operates five industrial mining sites in the Canadian province of Quebec, with a total wattage of 69 megawatts. At 210 megawatts and 55,000 state-of-the-art mining machines, the Argentine site will have almost three times as much capacity as all current Bitfarms sites put together.

Bitfarms mining operations run on hydropower to make bitcoin mining more environmentally friendly.

The company has made a significant expansion effort over the past year by purchasing new mining machines and is working towards being listed on the NASDAQ. In March, it announced that it had ordered 48,000 MicroBT miners, a “substantial portion” of which will be used in the new facility in Argentina.

A key factor in the expansion into Argentina is cost reduction.

“We previously reported the break-even cost to mine a bitcoin during the fourth quarter of 2020 was approximately $7,500 in Quebec. If the new Argentina facility was operating during the same period, we estimate the breakeven cost to mine the same bitcoin would have been $4,125, a 45% savings as compared to Quebec,” Bitfarms said in a statement.

This will also enable Bitfarms to use older mining equipment that requires more electricity in a more cost effective way.

Crypto miners are increasing their capacity as bitcoin continues to increase in value. Just last week, the crypto currency reached a record of over $64,000 just as the crypto exchange Coinbase went public on the US stock market. Since then, the price has come under some pressure. On Tuesday, it was trading around $55,282.19.

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