Recently, the National Power Administration (ANDE) in Paraguay has come under fire as seven of its engineers have been accused of being involved in setting up illegal bitcoin mining farms across the country. These state officials are said to have organized and deployed these illegal operations, with the prosecutor’s office now conducting an investigation in collaboration with ANDE. While ANDE’s President, Felix Sosa, has stated that the institution’s internal audit unit is looking into the matter and providing information to the authorities, he has also clarified that employees are not responsible for electrical connections, which are carried out by third-party contractors.
ANDE has been cracking down on illegal bitcoin mining operations since December, disconnecting over 70 farms that were siphoning unmetered power directly from the grid. However, this has sparked criticism from industry insiders who argue that issues like “vulture contracts” have caused more economic damage to the industry in Paraguay. Joaquin Morinigo, founder and CEO of Cryptopy, a Bitcoin and blockchain consulting agency, highlighted that allegations of corrupt activities involving ANDE officials have been circulating since 2018. He pointed out cases of bribery, extortion, and clandestine connections being reported across the country, indicating a systemic corruption issue within ANDE.
The Paraguayan government has expressed its intention to shift focus from bitcoin mining towards developing a more labor-intensive industry that utilizes the country’s energy resources more effectively. By reclaiming energy resources currently being sold to bitcoin miners, the government aims to foster economic growth and create job opportunities in other sectors. This move aligns with the government’s strategy of diversifying the economy and promoting sustainable development in Paraguay.
In light of these allegations and the ongoing investigation, it remains to be seen how ANDE will address the issue of corruption within its ranks and ensure that such illegal activities are not repeated in the future. The collaboration with the prosecutor’s office signifies a commitment to transparency and accountability, but more concrete steps may be needed to restore public trust in the institution. As the government seeks to reorient its energy resources towards more productive uses, it will be essential to address any lingering issues of corruption and malpractice within state institutions like ANDE to ensure a fair and competitive business environment for all stakeholders.
It is clear that the allegations of ANDE engineers being involved in setting up illegal bitcoin mining farms have raised serious concerns about corruption and misuse of power within the institution. While the internal audit and investigation process is a step in the right direction, more robust measures may be necessary to root out systemic issues and prevent similar incidents in the future. By addressing these challenges effectively, Paraguay can create a more transparent and accountable business environment that encourages sustainable economic growth and development. The government’s commitment to shifting towards a more diversified and labor-intensive industry signals a broader vision for the country’s future, highlighting the need for responsible governance and ethical business practices in the digital age.
