How Iceland Became a Hotspot for Bitcoin Mining: A Blend of Renewable Energy and Favorable Conditions

The Land of Ice and Fire: A Mining Haven

Fans of the sprawling landscapes in “Game of Thrones” would love Iceland, a country rich in renewable energy resources like hydro and geothermal power. Its cool climate and stable regulatory environment make it the world’s largest Bitcoin hash power producer per capita.

Powered Entirely by Renewable Energy

Iceland is home to a vast array of hydro and geothermal power plants, which together form an impressive electricity network around the island. Around 69% of its energy comes from hydro power and 31% from geothermal sources, making it one of the rare countries that are entirely powered by renewable energy, alongside Norway.

（Image via WIRED）

Energy Abundance: A Major Advantage for Miners

According to hashrateindex reports, Iceland’s electricity prices are set by the national utility company, Landsvirkjun, which is wholly owned by the state. Landsvirkjun sells electricity directly to power-intensive industries like aluminum smelters and Bitcoin miners through long-term fixed-price contracts.

The Bonus of “Non-Guaranteed Power”

In Iceland, some power is designated as “Non-guaranteed Power” due to its renewable nature. These power supplies may stop during times of lower hydro or geothermal production. Before Bitcoin miners, this power was going to waste, but now, miners can take advantage of it, gaining a significant pricing edge.

Cool Climate and Stable Regulations

Iceland’s mild climate, with monthly average temperatures ranging between 1-12°C in Reykjavík, allows for easy air cooling. This extends the life of mining hardware and lowers the cost of operation. The country’s political stability makes it a mining-friendly jurisdiction, as opposed to places with less supportive regulatory environments.

Challenges and Future Outlook

The major hurdle facing miners in Iceland is the scarcity of new power. With no new power plants being built in recent years, electricity is becoming increasingly scarce, limiting the sector’s growth prospects.

Key Players in Iceland

Companies like Greenblocks, Advania Data Centers, and Borealis Data Center dominate the local landscape. International players like Genesis Mining, Bitfury, Hive Blockchain, Bit Digital, and Startmining have also operated in the country.

（Image via Al Jazeera）

Conclusion

While Iceland’s abundant renewable energy and advantageous conditions make it an attractive mining location, the scarcity of new power supply presents a looming challenge. However, it remains a global leader in Bitcoin mining, setting an example for how renewable energy can support this burgeoning industry.

Keywords: Bitcoin Mining, Iceland, Renewable Energy, Hydro Power, Geothermal Power, Landsvirkjun, Non-Guaranteed Power, Regulatory Environment, Hashrate, Mining Hardware