Key Points
- Texas-based Bitcoin mining company Giga Energy expands to Argentina in partnership with Phoenix Global Resources and Exa Tech.
- Giga Energy’s sustainable mining operations utilize wasted natural gas from oil fields to fuel Bitcoin mining.
Giga Energy, a Bitcoin mining firm based in Texas, is extending its operations to Argentina following successful ventures in the U.S and Shanghai. The company recently revealed its partnership with Phoenix Global Resources, an oil and gas firm in Mendoza, and IT services provider Exa Tech. Together, they plan to establish a two-megawatt Bitcoin mine on Vaca Muerta.
Founded in 2019 by Brent Whitehead and Matt Lohstroh, Giga Energy focuses on harnessing the wasted natural gas from oil fields. This gas is then transformed into electrical energy to power the company’s energy-intensive Bitcoin mining operations.
Sustainable Mining Operations
Giga Energy’s operations involve deploying shipping containers filled with thousands of Bitcoin miners directly on oil wells. The natural gas from these wells is used to generate electricity for the mining machines. According to research by Denver-based Crusoe Energy Systems, this process reduces greenhouse gas emissions by 63% compared to simply burning off the natural gas.
Whitehead, in an interview with CNBC, stated that by capturing stranded natural gas to power modular data centers for energy-intensive computing, Giga is actively contributing to reducing global methane emissions. This sustainability-centric approach aligns perfectly with Argentina’s economic challenges.
Bitcoin Mining and Economic Opportunities
Bitcoin mining thrives during bullish market cycles. The recent surge in Bitcoin value, reaching exceptional highs, has catalyzed infrastructure expansion. Over the past six months, Bitcoin has surged 170%, reaching multiple record price peaks. This surge has been fueled in part by anticipation surrounding the introduction of spot Bitcoin exchange-traded funds in the United States.
Currently, Giga’s quarterly revenue exceeds $10 million, according to Lohstroh. Argentina, ranked 12th among global methane emitters according to World Bank data, presents opportunities for miners beyond Giga seeking to capitalize on this greenhouse gas.
The rise in cryptocurrency value has also boosted the stock valuations of publicly traded Bitcoin miners. For instance, CleanSpark saw an impressive fivefold jump in 2023, further augmented by a 112% rise this year. Cipher Mining’s shares skyrocketed by over 600% in 2024, followed by an additional 27% gain in 2024.
With inflation exceeding 211% in 2023, Argentina faces severe economic volatility. This has led many citizens to explore cryptocurrencies like Bitcoin as a safeguard against the peso’s dramatic devaluation, seeking a stable store of value amidst the nation’s turbulent economic landscape.
Newly-inaugurated Argentine President, Javier Milei, advocates for cryptocurrency and proposes sweeping economic overhauls. These involve abolishing the central bank and replacing the currency with the US dollar, signaling radical shifts in monetary policy and governance since assuming office in late 2023.
Despite the potential hurdle of Argentina’s import restrictions, implemented to protect its ailing currency, there is optimism. Federico Brom, Exa Tech’s director of business development, acknowledges this challenge but remains hopeful. Giga’s venture in Argentina is a testament to the evolving landscape of the Bitcoin mining industry. By combining entrepreneurial ingenuity with environmental responsibility, Giga Energy demonstrates that Bitcoin mining can have a positive impact on both the environment and the local economy.
