Iceland to Use More Electricity for Bitcoin Mining Than Powering Homes

Iceland is now a haven for cryptocurrency mining and this year; the activity will likely to use more electricity than powering of homes.

Bitcoin mining is thriving in Iceland as it might consume more electricity for Bitcoin mining than it uses to power every home.

Many crypto mining companies are planning to establish operations in the country. However, energy firm HS Orka told BBC that the state might not even be able to generate enough electricity for all Bitcoin mining centers.

The mining activity will use around 840-gigawatt hours of electricity this year. This is according to an estimate by Johann Snorri Sigurbergsson, a spokesman for the energy firm.

“I’m getting a lot of calls, visits from potential investors or companies wanting to build data centers in Iceland,” he said.

The Moonlite Project is the latest cryptocurrency mining project that will involve mining of Bitcoin and other cryptocurrencies. It launches this year and will use 15 megawatts although that will increase later on.

The country is famous for crypto mining activity because of the low energy costs. However, it’s low energy costs also attract data-mining firms. Nearly all of the country’s energy comes from renewals. Therefore, it is an example of how renewable energy can drive down prices but also in the crypto world, how that could help attract mining companies.

Currently, homes in Iceland use about 700-gigawatt hours of electricity per year. There are about 340, 000 people in the country.

Government is concerned

However, the government is starting to question cryptocurrency mining operations. This might bring some more changes in the field.

“Under normal circumstances, companies that are creating value in Iceland pay a certain amount of tax to the government,” Smari McCarthy, a member of Iceland’s Pirate Party, told the Associated Press. “These companies are not doing that, and we might want to ask ourselves whether they should.”

Another skeptic is Smari McCarthy a member of Iceland parliament for the Pirate Party.

He tweeted saying,

“Cryptocurrency mining requires almost no staff, very little in capital investments, and mostly leaves no taxes either. The value to Iceland… is virtually zero.”

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David Kariuki is a journalist who has a wide range of experience reporting about modern technology solutions including cryptocurrencies. A graduate of Kenya's Moi University, he also writes for Hypergrid Business, Cryptomorrow, and Cleanleap, and has previously worked for Resources Quarterly and Construction Review magazines.

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