Iceland has always been a prominent hub for the crypto miners, specifically Bitcoin due to the fact that 98 percent of its electricity comes from the renewable geothermal energy and the cold climate favouring mining farms which helps in keeping the facility cool can run a massive air-conditioning bills in warmer areas.
The Power Usage Effectiveness (PUE) of the country is 1.03 which is twice as much cost effective than the nearby countries in the continental Europe which comes to 1.78 of PUE. Genesis and Bitfury are the mining farms taking shelter in Iceland as one of the biggest Cryptocurrency miners which have set up the nation to capitalize on the natural advantages and now dwarf on many small mining enterprises. The establishment of this enterprises was motivated in some cases by the impact of the 2008 financial crisis of Icelandic Economy which wiped 60 percent of the value from the Icelandic Krone, the local fiat currency.
Bitcoin mining is so prevalent in the nation that the energy consumption is set to overtake that of the local households of 340,000 living on the small island. This was the time to scale the crypto mining enterprises.
In December 2017, the collapse of the Bitcoin (BTC) market from an ATH of $19,783 to $6,362 at the time of writing and causing many mining enterprises to continue the mining even at a loss, leading to the speculation that the mining era of Icelandic mining boom was over.
Halldór Jörgensson, chairman of Borealis Data Center confirmed this in a recentinterviewwith Red Herring, stating that the infrastructure has now been created in Iceland to pursue other blockchain-related business ventures:
“The demand is…shifting more towards the pure blockchain business. So you could say that the bitcoin wave, the big wave of bitcoin demand, has helped us to build out really fast, because there were really aggressive or interested parties who wanted to do things and we managed to do the build-out.
We strongly believe that when the whole bitcoin thing has settled down to some kind of a level that is not as crazy as it was a year ago […] another wave that crops up that will utilize these infrastructures that have been built up during the bitcoin mining phase.”
It may be that the Bitcoin mining can lead to the permanent decline in the country, but not completely. On the contrary, the nation is looking forward to hosting the new cryptocurrencies and the Blockchain enterprise, a growing industry which is estimated to reach a value of $2.3 Billion by 2021.
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