Bitcoin mining in Paraguay drives HIVE Digital profits amid energy grid concerns

HIVE Digital Technologies has projected significant mining margins of 36% to 52% as Bitcoin prices potentially rise toward $80,000. The company’s profitability is driven by its use of low-cost hydroelectric power in Paraguay, where it maintains an operational expenditure of approximately 5 cents per kWh.

HIVE reported a 73% year-over-year increase in Q1 FY2027 revenue, totaling $79.1 million, with $72.1 million originating from Bitcoin mining. The company also noted that its expansion into high-performance computing and AI infrastructure contributed roughly 9% of its total revenue.

While the availability of renewable energy has attracted mining operations, analysts warn of potential risks to Paraguay’s national energy grid. Bitcoin mining currently accounts for approximately 30% of the country’s total energy consumption. Experts at the ‘Accelerating Bitcoin’ conference cautioned that if energy demand continues to grow while generation remains stagnant, the nation could face an energy crisis by 2029. Concerns have also been raised regarding the expiration of energy contracts with mining firms in 2027 and the impact on long-term energy independence.