Paraguay Taps Seized Bitcoin Miners to Monetize Power

• Paraguay will deploy 1,500 seized miners using surplus hydropower from Itaipu Dam to drive state revenue.
• ANDE retains ownership of operations while Morphware provides technical expertise and staff training.
• Officials weigh selling mined BTC or hedging via U.S. futures amid cybersecurity risks.

Paraguay’s state power utility has signed an agreement to explore Bitcoin mining using seized machines and unused electricity. The move, announced this week in Asunción, involves the national utility and a U.S.-based mining firm. Officials aim to convert excess hydroelectric output into state revenue through regulated mining operations.

ANDE Signs MOU to Launch State-Led Mining Pilot

Paraguay’s electricity monopoly, Administración Nacional de Electricidad, signed a memorandum of understanding with Morphware. The agreement outlines cooperation on a government-led Bitcoin mining program using state-controlled infrastructure.

Under the MOU, Morphware will act as a technical and advisory partner. The pilot phase will deploy 1,500 confiscated Bitcoin miners at ANDE-controlled sites. According to Morphware, Paraguayan authorities currently hold thousands of seized machines in warehouses following enforcement actions.

Seized Miners and Excess Hydropower at the Core

The mining equipment was taken from operators accused of electricity theft or tariff evasion. According to Kenso Trabing, the machines were seized after illegal connections strained the national grid. He said the equipment now sits idle in government storage facilities.

Paraguay generates abundant low-cost hydroelectric power, largely from the Itaipu Dam, much of which is exported. However, domestic consumption remains limited. As a result, authorities are seeking ways to monetize unused energy locally.

The plan involves retrofitting existing ANDE buildings near substations. These sites already have grid access, which reduces infrastructure requirements. Morphware will provide training and operational guidance, while ANDE retains ownership and oversight.

Handling Bitcoin Output and Revenue Management

Discussions are ongoing about how Paraguay will manage mined Bitcoin. Some officials support selling production immediately to fund public programs. Others favor holding Bitcoin or hedging price risk through derivatives.

Morphware has advised against direct government custody due to cybersecurity concerns. Paraguay has experienced several major breaches affecting public systems. Instead, the firm has proposed hedging output using Bitcoin futures on U.S. exchanges.

The agreement reflects a broader policy shift. Rather than exporting surplus power at low rates, Paraguay is testing mining as a domestic revenue engine. Initial efforts will focus on training ANDE staff and integrating mining operations into the grid.