There are some countries in which this entire cryptocurrency trend has already gone too far. Iceland is one of the best examples, as the country’s energy company revealed that Bitcoin mining is becoming so popular that they are expecting to see more electricity being used for this than to power homes.
According to Fortune, this can cause serious problems, as Iceland’s officials warm that there won’t be enough energy reserves to supply the number of the expected Bitcoin mining centers if they will eventually open.
An energy crisis, scheduled for 2018?
“If all these projects are realized, we won’t have enough energy for it,” Johann Snorri Sigurbergsson, a spokesman for Icelandic energy firm HS Orka revealed.
These mining tools consist in large computers, alongside servers and cooling devices, will require around 840 gigawatt hours of electricity in 2017, according to an estimate mentioned by Mr. Sigurbergsson. As for all the homes in Iceland, they usually rely on around 700 gigawatt hours yearly, de added.
Over the past months, the country turned into an ideal location for cryptocurrency mining, mostly because of its cheap electricity. Iceland has such low fares because the country’s energy comes mostly from renewable sources, so a lot of overseas mining companies are considering moving their operations here.
The government is preparing a few changes
On the other side, Icelandic government officials are already questioning the real value of these operations. Bitcoing mining data centers don’t require a numerous stuff, nor a larger infrastructure investment, not to mention that they pay very low tax bills. In this case, considering the increasing energy consumption as well, is it actually worth it for the country to allow companies to move here?
Currently, it’s obvious that the answer is no. However, the government is planning to change the way these data centers are being taxed.
“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, said. “These companies are not doing that, and we might want to ask ourselves whether they should.”