Volcano Energy Joins Forces With Luxor as El Salvador Debuts Its First Bitcoin Mining Pool

El Salvador has officially launched its first local Bitcoin mining pool as part of the Volcano Energy initiative, in collaboration with Luxor Technology's Lava Pool. 

This development marks a significant milestone for the Bitcoin-friendly nation, which garnered attention in 2023 for its $1 billion renewable energy project. 

Notably, stablecoin issuer Tether is among the companies that have invested in this project, which aims to harness renewable energy sources within El Salvador to power future Bitcoin mining activities.

Volcano Energy is leveraging Luxor's expertise in providing Bitcoin mining software and services, with plans to use Luxor's Hashrate Forward Marketplace to manage market volatility. This marketplace utilizes automated risk management strategies employed by major Bitcoin mining operators.

Gerson Martinez, Chief Strategy Officer of Volcano Energy, emphasized the ongoing efforts by El Salvador to establish itself as a pioneering Bitcoin nation-state, saying, "our vision is to create a vertically integrated energy and Bitcoin mining company whose value is accretive to investors and to all Salvadoran citizens."

Ethan Vera, Chief Operating Officer of Luxor, highlighted that the establishment of Volcano Energy and the initiation of local Bitcoin mining align with Bitcoin's principles of geographical decentralization.

The announcement also highlights the potential for countries with abundant renewable energy resources to enhance the economics of new energy projects by engaging in Bitcoin mining. These mining operations can serve as a flexible buyer of energy, benefiting energy producers and providing an alternative revenue stream.

Volcano Energy, as a public-private partnership, has committed to contributing 23% of its net income from mining operations to the El Salvador government. 

Additionally, mining profits will be reinvested in energy transmission and infrastructure projects aimed at stimulating economic and technological growth in the Central American nation.

The initial phase of the Volcano Energy project involves the construction of a 241-megawatt (MW) renewable energy park in Metapán, comprising 169 MW of photovoltaic solar energy and 72 MW of wind power. 

The long-term objective of the project is to harness the abundant geothermal energy resources within the country.