Crypto

Bitcoin: Mining Company Moves to the Arctic to Cut Electricity Bills

Global warming and drought continue to affect our lives and the business world. Kryptovault AS, a bitcoin mining company based in the south of Norway, decided to move to the north of the country, right into the Arctic. Reason: Electricity bills have risen sharply in the south of the country due to a drought that has devastated some of the hydroelectric storage needed for local electricity generation, Bloomberg reported on Tuesday, August 9. If in the period from 2000 to 2019 the latter were filled by 74.9%, today they do not reach 50%. However, the country generates most of its electricity through its hydroelectric power plants: therefore, water shortages have led to bills skyrocketing.

Proof of this is that Kryptovault AS has doubled its account compared to last year – the latter accounts for 80% of its operating expenses, as bitcoin mining activities are particularly energy intensive. To operate a decentralized bitcoin platform, processors verify and process transactions made in bitcoins. The mining activity consists of solving a complex mathematical equation called “proof of work”. In exchange, the miner receives fragments of the cryptocurrency. However, this system requires a huge amount of energy.

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Faced with high electricity consumption and rising prices, the decision to relocate the company’s site to the north of the country was an obvious one for the managing director of the company, Kjetil Hove Pettersen – a “vital necessity”. There is always a lot of water in Antarctica, which explains the huge difference in prices between the two ends of the country. North of the Arctic Circle, electricity is 160 times cheaper than in the south.

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