Cryptocurrency Price Check: Revenue Erupts From El Salvador Volcano-Powered Mining

Cryptocurrency prices were mixed on Monday after last week’s surge, while El Salvador unveiled the first results of the country’s volcano-powered bitcoin-mining operation.

At last check Bitcoin, the world’s largest cryptocurrency, was off slightly to $47,934, according to CoinDesk. 

Ethereum was down 1.31% to $3,386, while Dogecoin was up 3.3% to 23 cents.

Zak Killermann, fintech and crypto expert with Finder, noted that it has been one month since El Salvador officially adopted the cryptocurrency as legal tender.

“Things are heating up in El Salvador with President Nayib Bukele announcing that the country’s volcano powered crypto mining operation has started generating revenue,” he said. 

“The “#volcanode” is mining bitcoin using geothermal power and marks a major step for El Salvador’s Bitcoin adoption.”

Killermann noted that Bitcoin and many other major cryptocurrencies are struggling to reclaim monthly highs despite a surge on Friday. Others, like Terra, surged to new all-time highs following Friday’s frenzy. 

“The market turning green maybe thanks to Federal Reserve Chair Powell clarifying that he has ‘no intention’ of banning crypto,” he said. 

“But not everything is green in the cryptocurrency world, particularly for the founders of Compound, a decentralized finance staking pool.”

Killermann said that after Compound mistakenly sent more than $90 million to users in an upgrade gone wrong, Robert Leshner, founder of Compound Labs, tweeted Thursday that users could “keep 10% as a white-hat. Otherwise, it’s being reported as income to the IRS, and most of you are doxxed.”

“Given the decentralized nature of Compound, there is no off switch or possibility for a reversal of funds, so time will tell if users decide to return the funds or not,” Killermann said.

Last week, China banned any crypto-related transactions by both businesses and citizens, David Lesperance managing partner of immigration and tax adviser Lesperance & Associates, said “will effectively divide that country’s cryptocurrencies holders.”

“One group will act to get their crypto assets and themselves an escape plan to avoid the complete control of the Chinese government,” he said. 

“Another group will not act and will be sentencing themselves to being under the thumb financially and physically of the central government authorities.”

Other countries that have currency controls, such as India, are watching China’s actions closely to see how effective it is, Lesperance said.

Winston Ma, a former managing director and head of North America at China Investment Corp., said centralized exchanges like Huobi have announced the details of withdrawal from China, which includes retiring Mainland China user accounts by the end of this year. 

Ma, author of “The Digital War – How China’s Tech Power Shapes the Future of AI, Blockchain and Cyberspace,” said Huobi is the first major exchange to eliminate existing Chinese users. 

“Whether similar centralized exchanges like Binance and OKex will launch is currently a topic of concern for the Chinese community,” he said. 

“Trillion-dollar question: Where will the Chinese traders (and their capital) go if their accounts at the major exchanges will be soon terminated?”