With its vast renewable energy resources, Iceland has emerged as a prime destination for Bitcoin mining.

However, according to a new study by one of the industry’s leading watchdogs, the country has used up about 120 MW of energy in bitcoin mining, accounting for about 1.3% of the world’s bitcoin hash rate. I’m here.

What makes Iceland a mining powerhouse?

thanks to iceland With its vast hydro and geothermal energy sources, the country has been able to dedicate 120 megawatts of electricity to Bitcoin mining, which is only 1.3% of the world’s hash rate. But with just 370,000 inhabitants, Iceland has the highest per capita hash rate in the world.

Iceland’s extraordinary energy dominance

Electricity-rich Iceland is the world’s most electricity-rich country, producing almost twice as much electricity as Norway, the second country on the list.

Top 10 countries for electricity generation per capita in 2021
(Source: Luxor and Hashrate Index)

Iceland and Norway are the only two countries in the world that rely entirely on renewable energy sources for their electricity needs.

Iceland: electricity generation by source in 2020
(Source: Hashrate Index and Luxor)

The recent surge in BTC price has boosted mining profitability by 35% since its launch in 2023. Bitcoin mining is booming not only in Iceland, but globally, as the network’s hashrate hit a new high of 318 exahash per second (EH/s).

political stability

A large part of Iceland’s appeal as a mining hub is that it is widely regarded as one of the most politically stable countries in the world.

“Domestic companies involved in mining in Iceland include Greenblocks, Advania Data Centers, and Borealis Data Center. In addition, many international players are currently active, including Genesis Mining, Bitfury, Hive Blockchain and Startmining. or have been there before.”

The Icelandic government supports Bitcoin mining, recognizing that it can attract foreign investment and create employment opportunities.

However, the government has also raised concerns about the environmental impact of bitcoin mining, urging the industry to become more sustainable by adopting more energy-efficient technologies.

Nevertheless, some of the major players in Iceland’s bitcoin mining industry have been operating for 10 years with few major issues from the authorities.

Iceland faces mining restrictions

The factors that make Iceland such an attractive environment for Bitcoin miners also affect supply and demand.

“Iceland’s electricity supply, which may have seemed limitless a few years ago, has been running out of steam in recent years. reported to be nearly impossible.”

This means that the growth potential of the industry in Iceland is limited, meaning that the 120 MW year “for the foreseeable future” is likely to continue.

By Jules

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