Iceland Becomes the Largest Bitcoin Mining Hub as Ground Shifts

A new report published by Hashrate Index – a platform tracking bitcoin mining across the globe – on February 21 showed emerging economies taking over the sector away from the best-known bitcoin mining hubs like the US and Kazakhstan.

Iceland, with a population of 370,000 people, has the largest hashrate production per capita globally, according to the Index. What positions the country at the top is the relatively affordable cost of electricity, among other factors like political stability.

One main problem that has affected the mining space is the high amount of electricity needed to run mining equipment. The challenge has put the industry at loggerheads with the regulators in some countries – who have capped the energy required in the sector.

In Iceland, the case is quite different, considering the surplus amount of energy, mostly from renewable sources like– hydro, volcanoes, and geothermal. The Hashrate Index estimated that the Icelandic bitcoin mining industry consumed an estimated 120 MW, or 1.3% of the Hashrate Index’s Bitcoin Mining Energy consumption, which stands at 9.3 GW.

Stable political environment and a conducive climatic condition

Besides the readily available energy resources, the Volcanic island enjoys a relatively stable political environment, a factor the Hashrate Index noted as key in the sector. Amid a volatile environment, for instance – China, which outlawed mining activities in 2021 – miners across the globe have come to appreciate the importance of softer regulations. The report acknowledged the prevailing peaceful working environment in Iceland as one of the growth drivers.

More importantly, the report took note of the conducive climatic condition in Iceland – also an important factor in cooling the heat-producing mining equipment in the country. The Arctic country has temperatures ranging between 1C (+34F) and 12C (+53F) from the coldest to the warmest period. Miners could also use the unlimited water supply to cool their equipment, per the report.

The mining companies in Iceland include Greenblocks, Advania Data Centers, and Borealis Data Center, with some international players like Genesis Mining, Bitfury, Hive Blockchain, and Startmining.