Paraguay picks AI over Bitcoin miners for its cheap power

Paraguay has some of the cheapest electricity on the planet. It comes from Itaipu, a giant hydroelectric dam the country shares with Brazil. For years, Bitcoin miners flocked there for that cheap power. Now Paraguay's state utility is cutting them off. Every miner's power contract will expire by the end of 2027. In their place: an AI data center backed by Founders Fund, a venture capital firm.

This isn't really about Bitcoin losing a fight to AI. It's about what counts as cheap power running out. Paraguay's low rates existed because almost nobody else wanted that much electricity at once. Miners signed up over the last decade specifically because nobody was competing for it. AI data centers changed that math fast. They need huge, steady power too, and they can pay more for it. ANDE, the utility, says the 2027 deadline isn't negotiable. Some miners are already looking for other countries willing to make a similar bet.

Keep reading — what to watch

Where do these miners go next? Bitcoin mining only works with very cheap, very reliable power. That's a short list of places worldwide. The list is getting shorter, because AI data centers are bidding up the same spots. Some miners may chase the next cheap grid, wherever that turns out to be. Others may just become power brokers themselves, leasing out sites to whichever buyer, crypto or AI, pays more. Paraguay is a small country, but the same squeeze is playing out everywhere electricity is cheap and plentiful.