
Should Paraguay invest its energy wealth in Bitcoin mining or fighting poverty? - macbookaries
https://www.theguardian.com/global-development/2018/nov/05/should-paraguay-invest-its-energy-wealth-in-bitcoin-mining-or-fighting-poverty
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gus_massa
The article assumes that mining Bitcoins and fighting poverty are
incompatible.

They have an excess of cheap electricity, and they don't know what to do with
it. (And a bad electric grid.)

A good trick is to build a aluminum smelter because it use a lot of
electricity. [In Argentina we have Aluar
[https://en.wikipedia.org/wiki/Aluar](https://en.wikipedia.org/wiki/Aluar)
They essentially have their own hydroelectric dam.] But for an aluminum
smelter you need a lot of inversion, it uses some toxic material, and you need
good fluvial communication (they probably have this part). It's not easy to
build an aluminum smelter.

Another possibility is to mine Bitcoins. It needs a lower amount of inversion,
and it has less logistic problems because you don't need a giant port to
receive the bauxite and send the refined aluminum.

What is the difference between Aluminum and Bitcoins? You don't care is
someone is willing to pay for it! (If you are a cryptoskeptic (like me), you
can think that the Aluminium will be valuable for a longer time than the
Bitcoins. But it is not important if you sell the production now.)

The solution for the poverty is to raise the prize of he electricity and use
the additional money to diversify the industry in case Bitcoins implodes. (I
doubt that the government plans are the best way to invest the money, anyway.)
You can add some tax to the mined bitcoins, but it's almost imposible to
check. So everyone will just not pay the tax. It's easier to raise the price
of the electricity and perhaps add a discount for family houses small
industries or whatever you like.

