Despite a government mandate to disconnect all Bitcoin mining operations from the national power grid, clandestine Bitcoin mining is experiencing a resurgence in Venezuela, albeit on a smaller scale. Local reports indicate that underground operations have adapted to continue functioning by concealing their activities in undisclosed locations. This resurgence has been facilitated by local ASIC stores, which continue to supply miners for small-scale operations.
Revival of Small-Scale Bitcoin Mining
Bitcoin miners in Venezuela have reverted to covert operations, reminiscent of earlier days in the cryptocurrency industry. According to local sources, the Bitcoin mining ecosystem remains active, driven by small farms that maintain low energy consumption, enabling them to operate discreetly.
Local mining equipment store owners have adapted to the changing landscape by catering to the needs of small miners. Jesus Montilla, executive manager of Crypto Tools, confirmed that the market for Bitcoin miners in Venezuela persists due to these covert operations.
He remarked, “At this point, it can’t die. There is that small investor with his ‘little machines,’ and thanks to them, the market has not finished dying.”
Government Crackdown and Its Aftermath
In May, the Venezuelan government ordered the shutdown of all registered Bitcoin mining farms, citing an escalating energy crisis. This directive led to the seizure and disconnection of over 17,000 miners from the national power grid, significantly impacting large mining operations.
A miner who has transitioned to clandestine operations shared insights with Criptonoticias under the condition of anonymity. Operating 60 miners in a secret location in Caracas, he affirmed that underground mining remains profitable in Venezuela, despite the associated risks.
He emphasized, “Many miners have mitigated the risks and know where to establish clandestine mining farms. If you do things right, clandestine mining is the safest thing there is right now in Venezuela.” He also noted that in cases where authorities detect a mining farm, bribes could ensure continued operation.
Future Challenges for Clandestine Miners
However, the miner acknowledged that this mode of operation might not be sustainable long-term. The inability to upgrade to new equipment poses a significant challenge to the viability of clandestine mining.
