Given the current cryptocurrency boom, HIVE Digital Technologies has been making headlines with its push into Paraguay, which could lead to a major increase in Bitcoin production. Great for them, awesome news for Bitcoin, super duper tremendous — OK let’s tap the breaks for a second. Are we actually thinking about what that would mean for Paraguay as a whole? Is this the ultimate win-win, or are we just seeing another iteration of a resource grab hidden behind the rhetoric of innovation and improvement? The ethical tightrope walk is real, folks.

Is Paraguay truly benefiting here?

Let's be clear: Paraguay needs investment. To be successful, any investment must equip the local community to guide development. It should be for the people — not to line the pockets of overseas corporations and their well-connected executives. HIVE regularly claims to be a leader in a “green mining strategy,” benefiting from Paraguay’s clean, hydroelectric energy. Great, on the surface. But who controls that power? Who profits from it? And at what cost to the Paraguayan people and their environment, I might add.

We're told HIVE's Phase 1 and 2 expansions in Yguazú will boost their hashrate and efficiency, and that they're deploying fancy new Bitmain S21+ Hydro miners. Instead, they’re concerned with finding new ways to increase their exceptional profits. They’re hoping to achieve a production run rate of 12 BTC per day by the end of 2025. Is this actually sustainable development, or just sustainable electricity use for a European car company?

This story makes headlines when talking about those 2,809,000 Restricted Share Units (RSUs) issued to employees. Wonderful for them, but what about the local boots on the ground? Are they being compensated appropriately with fair wages and benefits, or just the highest level bureaucrats and consultants lining their pockets?

Here's the uncomfortable truth: resource extraction, even when "green," can easily become exploitative. We've seen it time and again. A wealthy country full of technology and talent magically transforms into some sort of playground for foreign owned companies. They mine for wealth, cook the books for profit, and pack their bags while poisoning the land and abandoning the people. And are we certain we’re not seeing the beginning of that situation play out right here?

Jobs, Infrastructure, Or Just Promises?

In response, HIVE will undoubtedly tout the new jobs they create and much-needed infrastructure that could be built as advantages. And yes, some jobs will be created. First, are these high-paying, skilled jobs going to Paraguayans? Or are they temporary low-wage, repeated labor opportunities that do little to stimulate the local economy?

Don’t misconstrue me, I have nothing against Bitcoin mining in and of itself. I am all for a progressive era that stands up to unchecked corporate power and the exploitation of vulnerable countries. We need transparency. We need accountability. We need to ask the hard questions:

  • What specific commitments has HIVE made to the Paraguayan people?
  • What are the environmental safeguards in place to protect Paraguay's natural resources?
  • How is HIVE ensuring fair labor practices and decent wages for its Paraguayan employees?

Only by answering these questions will we see what HIVE’s expansion really means for Paraguay. Will it truly improve the country, or will it just be another case of a big corporation cashing in on an emerging economy?

Mining Bitcoin, Or Mining Paraguay?

The excitement surrounding HIVE’s multi-pronged expansion centers on increases in Bitcoin production, growth of their global hashrate and increased fleet efficiency. It's all about their gains. What about the gains for Paraguay?

This isn't just about Bitcoin. This is all about responsible investment, ethical investment and smart development. It looks at how international businesses can either benefit or take advantage of emerging countries. This talk went beyond the usual corporate social responsibility spiel. Does it view Paraguay as a partner valuable to the U.S. strategic interests, or as a tool to be exploited?

The company has set a goal of reaching 25 EH/s by American Thanksgiving—which is ambitious and laudable, but still. Can they commit to a minimum target for the number of new local jobs they intend to generate? On top of that, what other infrastructure expansions do they expect to have done by year’s end?

Ultimately, I hope that we can all do a better job of looking beyond these expansion strategies and being more critical of them, asking the tough questions. This is why we must demand transparency and accountability from firms specializing in disruptive technologies, firms like HIVE. It’s important that their pursuit of Bitcoin does not endanger Paraguay’s future. If not, we're complicit in a potentially exploitative relationship, where Bitcoin's gain is Paraguay's loss. That’s a cost far too great to bear. Those net proceeds go towards funding ATM Equity Program projects that include ASIC and GPU infrastructure, data center expansions, and general working capital needs. Just as important, though, is that they direct a big chunk of that budget to benefit the local economy in Paraguay.