Quick back of envelope calculation for how #ElSalvador could generate enough $BTC from mining to easily pay off interest & principle from $1B “Volcano Bond”
Annual BTC mining rewards = $13B (assuming $40k price), ignore fees
Electricity used = 120TWh
Hours in year = 8760
1/N
Annual BTC mining rewards = $13B (assuming $40k price), ignore fees
Electricity used = 120TWh
Hours in year = 8760
1/N
Therefore Power used = 120TWh / 8760 = 13.7GW
@nayibbukele said they ALREADY have a 95MW thermal facility drilled
So ASSUMING just this 95MW can be all used for BTC mining, and assume an average efficiency of miners, this can generate:
95/13700 = 0.7pc of rewards
2/N
@nayibbukele said they ALREADY have a 95MW thermal facility drilled
So ASSUMING just this 95MW can be all used for BTC mining, and assume an average efficiency of miners, this can generate:
95/13700 = 0.7pc of rewards
2/N
0.7pc * $13B total rewards = $95m worth of BTC
And this is just ONE geothermal facility, they have more…
3/N
And this is just ONE geothermal facility, they have more…
3/N
Let’s assume they can get hold of S19’s, they each take 3.3kW of power. So they would need:
95MW / 3.3kW = 29,000 S19’s which are ROUGHLY $5k each (secondhand), which would be $145m
Ofc course there are other costs in building the facility
4/N
95MW / 3.3kW = 29,000 S19’s which are ROUGHLY $5k each (secondhand), which would be $145m
Ofc course there are other costs in building the facility
4/N
So let’s assume $200m all in cost, and so then $800m can be used to build 4x MORE facilities; and if done that would generate:
$95m * 5 = $475m of BTC per year
Easily enough to pay a say 5pc yield on the $1B ($50m) and also pay off the principal of $1B over 2-3 years
5/N
$95m * 5 = $475m of BTC per year
Easily enough to pay a say 5pc yield on the $1B ($50m) and also pay off the principal of $1B over 2-3 years
5/N
We have assumed the S19’s work efficiently for the 2-3 years of operation, but we can’t know the future precisely, so let’s just assume this
There will be running costs too, but trying to keep this really simple!
Total MW required would be 95MW * 5 = 475MW
6/N
There will be running costs too, but trying to keep this really simple!
Total MW required would be 95MW * 5 = 475MW
6/N
475MW for reference is a pretty normal large power station (not super large which are several GW); or a few medium geothermal plants
How many more geo sites does SLV have?
But if you can have in-effect free electricity then BTC mining is very profitable
7/N
How many more geo sites does SLV have?
But if you can have in-effect free electricity then BTC mining is very profitable
7/N
Of course the capital costs could have to been depreciated faster, but let’s not get into that, there is RISK still; this is not a risk free project!
8/N
8/N
Please could people who are in the industry like @MartyBent let me know if the numbers are roughly correct?
The cost of secondhand S19s is a huge assumption ($5000 each?), and I am not an expert on the latest market prices for these!
9/N
The cost of secondhand S19s is a huge assumption ($5000 each?), and I am not an expert on the latest market prices for these!
9/N
In conclusion, of course this can work, they have free electricity & BTC mining is economic when you DON’T have free electricity (but instead very cheap say 2-3c / kWh)
Thought it was fun to lay it out in a ROUGH MANNER to illustrate this is very much feasible
FIN
Thought it was fun to lay it out in a ROUGH MANNER to illustrate this is very much feasible
FIN
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