A partnership between Volcano Energy and Luxor gives birth to Lava Pool, the first mining pool based in El Salvador.
Volcano Energy disclosed a recent partnership with Luxor Technologies to initiate the country’s first-ever Bitcoin mining pool: Lava Pool. The announcement comes on the heels of Volcano Energy’s foray into Bitcoin mining in El Salvador earlier this year in June.
The regulatory framework
Gerson MartĂnez, the Chief Strategy Officer of Volcano Energy, elaborated on the endeavor’s objectives in an email interview with Forbes. He emphasized that the collaboration aims to foster the decentralization of Bitcoin mining, leveraging the “regulatory clarity” that El Salvador offers. MartĂnez stated:
Launching Lava Pool from El Salvador, the sole nation that provides a stable and predictable environment for Bitcoin enterprises, was a strategic decision guided by these advantages.
Mining pools serve as collective platforms where individual Bitcoin miners collaborate. By amalgamating their hash rate, participants improve their odds of successfully mining Bitcoin and earning rewards. Lava Pool is set to become an integral part of El Salvador’s evolving approach to Bitcoin mining. The payment structure for the pool will follow the Full Pay Per Share model, ensuring that payouts are proportionally allocated based on each miner’s contribution of hash power to the pool. MartĂnez accentuated that their goal is also to offer “the most cost-efficient mining pool solution tailored for smaller-scale miners.”
Volcano Energy’s project
Volcano Energy is currently in the process of constructing the necessary infrastructure to enable Bitcoin mining operations within El Salvador, specifically in the country’s western Santa Ana department. The company plans to utilize renewable energy resources like wind and solar power. The venture is expected to yield a renewable energy capacity of 241 MW, which will not only serve Bitcoin mining operations but also deliver electricity to local communities.
According to Ethan Vera, Chief Operations Officer of Luxor Technologies, the “essence of Bitcoin mining is intrinsically tied to the principle of geographical decentralization.” Vera stated that the establishment of a mining pool infrastructure in El Salvador will be a pivotal step toward realizing this ideal. Luxor, one of the global top-ten Bitcoin mining pools boasting a 3.3% share of the total network hash rate as per BTC.com statistics, will charge a nominal fee for its managerial services to Lava Pool. In return, the latter will benefit from reduced mining fees.
