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Is Iceland Ground Zero for Geothermal Crypto-Gold?

by Thomas Ressler

Northern countries like Iceland may be giving the cryptocurrency world a big lesson in comparative advantage. Iceland’s cheap and abundant electricity, thanks to plentiful geothermal energy nearby, enables cryptocurrency mining operations there to mine for Bitcoin more cost effectively than other environments.

Also, the Artic cooling temperatures make it much easier and cheaper to keep a tight lid on the heat associated with the expenditure of the substantial amounts of electrical energy powering the extensive computer activity needed to mine cryptocurrencies. Already, shrewd operators in the digital currency space are setting up shop in Iceland and competing with firms in countries such as China and Venezuela that offer heavily subsidized energy.

HIVE Blockchain Technologies Ltd., a publicly traded firm based in Vancouver that once mined gold, is now mining for cryptos. Why Iceland? “Mining cryptocurrencies profitably relies heavily on efficient energy infrastructure. Iceland is ideally suited to crypto-mining due to having a naturally occurring cold climate and abundant, cheap electricity from renewable sources like geothermal and hydro,” the company explains on its website. “Iceland also has fast and reliable Internet connectivity and is a gateway between Europe and North America.”

Genesis Mining Ltd, founded in Hong Kong in 2013 by early Bitcoin investors and mining pioneers, now runs Enigma, which it claims is the world’s largest Ethererum mining farm, in Iceland. It also runs a Bitcoin mining facility in the country, built with farming hardware from its partners, Spondoolies Tech, and a Dash mining facility, also in Iceland.

BitFury Group, which touts itself as the world’s leading full-service blockchain technology company and one of the largest private infrastructure providers in the blockchain ecosystem, has a data center operation in Iceland.

Cloud Hashing, one of the largest Bitcoin mining companies in the world, is based in London and has a computing facility in Reykjanesbær, Iceland.

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