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In order to save money on energy, bitcoin miners relocated to northern Sweden and Norway. However, given that the cost of electricity increased there as well this winter, Bitcoin mining may no longer be profitable. According to a CoinDesk story, miners are turning off for the winter as a result of the spike in energy costs.
Bitcoin Mining in Europe Is Becoming Infeasible (Image by sentavio on Freepik)
It is regrettable that the cost of electricity has reached a record high, especially given that winter has just begun. The need for heating will increase with time, pushing the cost even higher. Miners flocked to the northern regions of Europe not long ago. Due to the abundance of hydroelectric power and low demand, the cost of electricity is among the lowest in the world. Even some of them moved to the Americas.
Growing Costs of Energy
The cost of electricity in northern Norway in December of this year was $0.18 USD per kilowatt hour (kWh), which is roughly four times the cost in the preceding three years, according to data from the European power exchange Nordpool. In Sweden, prices are more than three times higher.
According to Denis Rusinovich, co-founder of the mining companies Maverick Group and CMG Cryptocurrency Mining Group In late November, he said that electricity generation was challenging in the UK, Norway, Sweden, and Germany due to low temperatures and a notable lack of wind. The strain on the natural gas supply caused by the situation in Ukraine made delays in planned nuclear facility maintenance in France, Sweden, and Finland worse.
As a result of the price increase, Rusinovich continued, miners have a motive to turn off their equipment in order to save money on power bills. Kjetil Pettersen, CEO of Norway-based Kryptovault, added that whether miners can survive without receiving Bitcoin mining profits depends on their reserve capital and ability to obtain more funds.
Final Thoughts
Some miners are thinking about selling their mining equipment due to the persistently high energy expenses. It might be a good idea to purchase distressed assets now. Large corporations have requested Chapter 11 bankruptcy protection, including Core Scientific. Furthermore, mining sites are offered for sale at steep discounts ranging from 80% to 90% off.
In order to save money on energy, bitcoin miners relocated to northern Sweden and Norway. However, given that the cost of electricity increased there as well this winter, Bitcoin mining may no longer be profitable. According to a CoinDesk story, miners are turning off for the winter as a result of the spike in energy costs.
Bitcoin Mining in Europe Is Becoming Infeasible (Image by sentavio on Freepik)
It is regrettable that the cost of electricity has reached a record high, especially given that winter has just begun. The need for heating will increase with time, pushing the cost even higher. Miners flocked to the northern regions of Europe not long ago. Due to the abundance of hydroelectric power and low demand, the cost of electricity is among the lowest in the world. Even some of them moved to the Americas.
Growing Costs of Energy
The cost of electricity in northern Norway in December of this year was $0.18 USD per kilowatt hour (kWh), which is roughly four times the cost in the preceding three years, according to data from the European power exchange Nordpool. In Sweden, prices are more than three times higher.
According to Denis Rusinovich, co-founder of the mining companies Maverick Group and CMG Cryptocurrency Mining Group In late November, he said that electricity generation was challenging in the UK, Norway, Sweden, and Germany due to low temperatures and a notable lack of wind. The strain on the natural gas supply caused by the situation in Ukraine made delays in planned nuclear facility maintenance in France, Sweden, and Finland worse.
As a result of the price increase, Rusinovich continued, miners have a motive to turn off their equipment in order to save money on power bills. Kjetil Pettersen, CEO of Norway-based Kryptovault, added that whether miners can survive without receiving Bitcoin mining profits depends on their reserve capital and ability to obtain more funds.
Final Thoughts
Some miners are thinking about selling their mining equipment due to the persistently high energy expenses. It might be a good idea to purchase distressed assets now. Large corporations have requested Chapter 11 bankruptcy protection, including Core Scientific. Furthermore, mining sites are offered for sale at steep discounts ranging from 80% to 90% off.
