Bitcoin mining in Iceland might use extra electrical energy than households

Iceland to use more energy mining bitcoin than powering its homes this year

He said: "If all these projects are realised, we won't have enough energy for it".

Mr Sigurbergsson's calculations were first reported by the Associated Press. Iceland's National Energy Authority stated that this was more than households use on the island nation of 340,000.

These computers solve complex mathematical problems - a process that in turn validates transactions between users of the crypto-currency.

"What we're seeing now is. you can nearly call it exponential growth, I think, in the [energy] consumption of data centres", said Mr Sigurbergsson.

Bitcoin mining tools, which primarily consist of large computers, servers, and cooling devices, will use around 840 gigawatt hours of electricity this year, Sigurbergsson estimated.

"Just today, I came from a meeting with a mining company seeking to buy 18 megawatts", he added.

Media captionBitcoin explained: How do cryptocurrencies work? He claims that he is getting many calls from investors wanting to build centers in Iceland. A lot of them are waiting for an opportunity to place their centres there though it is impossible to satisfy all their requests.




He added that his firm was mostly interested in dealing with companies that were willing to commit to long-term contracts of a few years or more.

But the demand for mining bases has sparked a dire warning with one firm insisting Iceland will not have enough energy for upcoming crypto mining projects.

It is set to open later this year and will have an initial capacity of 15 megawatts, though this is expected to increase in the future. After China and Canada, Iceland is the following hot area for the huge companies invested into virtual currency mining.

The development of the mining organizations in Iceland has prompted the lawmaker of its Pirate Party, Smari McCarthy to bring up the idea of taxing the profits of bitcoin mines.

"The value-to-Iceland/value-generated ratio is virtually zero".

The Pirate Party now holds 6 seats out of 63 in the Althing, Iceland's parliament, meaning that the party alone is unlikely to succeed in pursuing any kind of bitcoin mining tax on its own.

As for functioning of the computers that create Bitcoins, enormous amounts of electricity are required, it is important to find a source of cheap power.

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