Scandinavia once again becomes a profitable location for miners due to decreased electricity prices caused by record wet weather.
Record humidity over the past 20 years, coupled with moderate temperatures in Scandinavian countries, led to an increase in the production of electricity from hydroelectric power plants. As a result, energy prices in Sweden and Norway fell to their lowest levels in the world, Bloomberg reports. Thus, Scandinavian countries became alternative to other regions where huge mining enterprises are traditionally localized, i.e. China, Kazakhstan, and Canada.
65% of the world’s bitcoin hashrate is concentrated in China, according to the recent study by the Cambridge Centre for Alternative Finance (CCAF). Approximately half of that hashrate in China is produced in one autonomous region of Xinjiang (35.76%). China is followed by the United States (7.2%), Russia (6.9%) and Kazakhstan (6.17%). Malaysia (4.33%), Iran (3.82%), Canada, Germany, Norway, and Venezuela are also included in the top ten countries with the highest concentration of bitcoin mining capacities. The last four countries account for less than 1% of bitcoin hashrate, each one.
In 2019, Norway had the lowest electricity prices for industrial consumers among the 30 member countries of the International Energy Agency. In the first half of 2020, Norway was second only to Iceland by lowest electricity prices in the world.
“The ones that stayed through the difficult period, like us, are quite happy now,” said Philip Salter, head of operations at Hong Kong-based Genesis Mining Ltd., which operates a data center in Boden, Sweden. According to him, in 2020, the profitability of their data center has more than tripled.
In November, blockchain company Bitfury Holding BV announced plans to invest $35 million to expand its data center in Norway. “We have seen a notable up-tick in investor appetite for Bitcoin mining opportunities in Norway,” said Tyler Page, a business developer at Bitfury. “This year’s energy prices were particularly low as Bitcoin prices have increased.”
Amidst the second halving in the bitcoin network in 2016, the bitcoin mining firm KnCMiner based in Sweden declared itself bankrupt in a preclusive step to save its revenues.