By James Lawrence - News - 3 months ago

Iceland Shifts Focus But Continues Investment

Iceland has long been a crypto mining haven, mining giant Bitfury has a long history of investment in the country as too does Genesis. Iceland has been favoured by miners around the world due to its renewable energy and cold climate. A massive 98 percent of Iceland’s electricity comes from renewable geothermal sources, making it both cheap and a good look for companies, the geography of the country is also advantageous as its cold climate mitigates massive air conditioning bills, making Iceland an ideal location for mining operations.

Mining establishment on the island was motivated in response to the impact of the 2008 financial crisis which reduced the Icelandic Króna value by 60 percent. Another factor was Power Usage Effectiveness (PUE), a measure of energy efficiency, Iceland’s score of 1.03 is supposedly pretty good. Mining became so prevalent as to take over the energy consumption of the entire residential population. Which to be fair is just short of 350,000 people.

It was all looking peachy for Iceland but since the crash of Bitcoin and other altcoins late last year, mining has gone into recession. Many data facilities closed around the world or were forced to mine at a loss. It would seem the boom-days are over for mining in Iceland.

While Iceland felt the brunt of the crypto crash they weren’t wholly discouraged, miners are now pursuing other blockchain related business ventures. As reported in CCN, Halldór Jörgensson, chairman of Borealis Data Center confirmed this shift in an interview with Red Herring, explaining 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.”

Iceland’s sustained push into the decentralized realm is even reportedly backed by the Central Bank of Iceland which has proposed a potential move away from traditional paper-and-coin Icelandic currency, introducing instead a new cryptocurrency, the e-króna. The report can be read here, though you will have to be sufficient in Icelandic. Iceland’s infrastructure continues to be a major asset in blockchain applications, as reported by analyst Statista, the global blockchain market is set to reach $2.3 billion in value by 2021, the small island continues to develop to ensure a large stake in the industry.