Category Archives: Iceland

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Recent Calculations Show Global Mining Energy Supply to Be Mostly Renewables Based

The UK based CoinShares has released a report detailing the origins of global energy resources used in Bitcoin mining.

The crypto assets research and investment firm, listed on Stockholm’s NASDAQ/OMX exchange, conducted the survey in answer to critics’ continued arguments that Bitcoin mining is essentially an environmentally harmful activity due to its extreme use of electricity. It was also conducted in response to an article published by University of Hawaii’s Department of Geography and Environment which called on its own research to determine that Bitcoin mining could cause the pollution limits to exceed those stipulated by the 2015 Paris Agreement.

The article, written by Camila Mora, asserted that this carbon footprint calculation was achieved by multiplying Bitcoin’s 2017 estimated energy consumption and CO2 emission rates associated with countries from which mined blocks were thought to have been mined. According to Mora:

“By multiplying the electricity consumption of every block in 2017 by the electricity emissions in the country where the proof-of-work was likely to be resolved, we were able to estimate the total CO2 emissions for computing every block in 2017.”

The CoinShares news report has responded to this calculation by calling on industry insider knowledge and data available to the general public in order to put together an estimate of exactly where the energy used by the miners originate. The proposal is that 77.6% of worldwide Bitcoin mining is conducted through the use of renewable energy resources.

CoinShares accuses the University of Hawaii’s report of being inaccurate and oversimplified which lacked the regional economic and political considerations of the CoinShares analysis. The reality, according to the new report is that most of the world’s crypto mining has been conducted in China up until now, which is calculated to be about 60% of global mining, despite many countries being driven overseas due to climbing costs and the search for cooler climates.

China now has a major campaign which is aimed at drawing the country to supplying renewable energy such as solar. The Chinese program, entitled “curtailment” is largely conducted in regions where most Bitcoin mining takes place. Last year China became the world’s highest producer of solar energy. This has resulted in a glut of power which regional grids in these newly labeled areas are simply unable to deal with.

The outcome is that companies mining Bitcoin are moving to the “curtailment “ areas to lower their production costs resulting in extremely high renewable powered mining statistics: 95% of Chinese mining through renewable energy and 80% of total Chinese mining (or 48% of global mining) occurring in Sichuan.

Outside of China, Russia is at the other end of the scale with only 17% of its cryptocurrency mining conducted using renewable energy recourses. Iceland, Georgia, and the Northwestern US, on the other hand, are strong adherents to the use of renewable energy for Bitcoin mining.

Projects are currently underway in the Sahara using a 900-megawatt wind farm south of Marrakesh, and in Japan using solar power through the Kumamoto Electric Power Company

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Siberian Church Turns to the Power of Crypto In Mining Gaff

A church in Irkutsk, Siberia’s largest state, has been taken to court for draining too much power from the local grid through crypto mining.

Crypto mining in itself is not illegal and Russian law permits reduced power rates for non-government organizations. But, it seems that the church decided to go beyond covering essential heating and lighting and raised extra funds in their own way through crypto mining.

Most churches fundraise for essential repairs, but it seems as though someone in this parish had their own particular use for the extra generation of cash raised by their mining activities. It is not clear if members of the clergy or someone in the parish had locked into the church’s power supply, but the court found for the power company that no case of power theft was suggested, which does indicate that the irregular use of power may have been authorised by the church.

The result means that the church has a tab of $16,000 to pick up and faces their tariffs being raised by the electricity company. More importantly, the case may set a precedent in the courts for future such incidents when excess power is drawn without consultation with local electricity providers. Although not currently legislated for, extreme overuse of power through crypto mining may invite closer government scrutiny if it became a common occurrence.

The cold climate, particularly in locations such as Siberia with its sub-zero temperatures, has made the likes of Russia and Iceland the go-to destinations for industrial level crypto mining. The Russian Association of Crypto Industry and Blockchain (RACIB) claims that there are now over 400,000 people employed in the sector. 70,000 enterprises operate hundreds of thousands of mining rigs, with an increase in one-man operators working from their homes.

Because much of Russia’s mining proceeds go towards foreign investment, locally run mining pools are becoming popular as a way of cutting back on the amount of Russian money going towards overseas enterprises through crypto mining.

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Icelandic Crypto Mining: Nucleus of New Technological Age?

Iceland’s Bitcoin mining industry may be cooling off if recent statistic regarding the uptake of blockchain-related products is any indicator, but the centers themselves may create a whole new impetus for new technology.

Iceland has become an iconic name in the industry due principally to the number of companies seeking both cool weather and a cheap power supply – two important factors in Bitcoin mining.

Cryptocurrency miners from warmer climes are reportedly looking to move their operations to Norway and Sweden, with hydroelectricity and other renewables from more developed European countries allowing for cheaper electricity tariffs beneficial to profits as electricity is the main overhead. Iceland has been a popular location due to the low temperatures which naturally dissipate the heat that is generated.

Until now, Iceland has been seen by many as the most profitable location for Bitcoin mining activities in the world but if recent reports are accurate, this might be changing, with blockchain ventures on the increase on the country. Halldor Jorgensson, chairman of Borealis Data Centre located outside the Keflavik International Airport claims that center was seeing huge volumes at the end of last year. He recently commented:

“So you could say that the Bitcoin wave, the big wave of Bitcoin demand, has helped us to build out really fast, because there were really aggressively interested investors who wanted to do things and we managed to do the build-out.”

Jorgensson maintains that, although the huge requirement for Bitcoin pushed the mining industry forward and that it is quite possible a new wave is around the corner, there has been a discernable shift of focus:

“The demand is… shifting more towards the pure blockchain business… We strongly believe that when the whole Bitcoin thing has settled down to some kind of a level that is not as crazy as it was a year ago.”

The data center chief asserts that Iceland is well placed for a further surge in Bitcoin mining due to the infrastructure put in place to cater for the huge impetus created by Bitcoin’s rising fortunes at the end of 2017. However, there are those in the country who feel that Iceland’s economic reliance on Bitcoin carries with it some element of risk.

Johann Snorri Sigurbergsson, business development manager at HS Orka power plant which provides power to crypto mining farms, sees the data centers having a bright future for use in the AI industry in years to come, suggesting that such centers could become the nucleus of future technology. Asgeir Margeirsson, the power plant’s CEO, agrees, arguing:

“The fourth revolution is starting. It would be terrible for us in Iceland not to follow that development. If we were not to take part in the next development into the future, we would slide back.”

 

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US Defence Department Facility to Become Crypto Mining Data Center

A Nevada-based cryptocurrency investment company is planning to convert a US Department of Defense facility into crypto mining data center.

The company, Wuhan General Group (China) Inc, has seized the opportunity to use the redundant facility, originally called the Defense Department Data Center, for its mining project which will eventually be able to tap into a power supply able to support a total of 1,300 mining rigs.

Amid stiff competition around the world, companies are finding it increasingly difficult to find locations suitable for Bitcoin mining. The US has seen a flurry of activity this year with numerous outmoded plants being readapted for crypto mining.

Many aluminum sites around the country have been readapted towards utilization for mining. Alcoa World Alumina and Chemicals (AWAC), with customers in China, the United States, Europe and Brazil, have notably seen some of their old operational US sites for aluminum processing go.

Bitmain has been creating mining supersites, mining farms on a scale never seen before. Other major cryptocurrency mining firms like Coinmint are also building similar sites. Ramy Kamaneh, Wuhan General Group’s CEO, maintains that it was just a matter of time before the company seized the opportunity to become another overseas company to mine in the US:

“We had planned to build this operation three months ago, but with the bearish cryptocurrency market, we took a step back to reassess our strategy. The decision to wait for market stability was a good one, especially considering many cryptocurrency machines are no longer profitable in the current market.”

Once negotiations have been completed, the first 1,300 rigs will be installed in October, followed by the potential to add 12,000 more rigs in 2019. The initial installation according to the company should create a monthly revenue of USD 3.5 million.

The challenge for industrial-scale crypto mining in the US as the sector moves forwards is to develop more sustainable methods of operating, such as utilizing more hydroelectricity. A good example of how this can be both profitable and ecologically sound is DPW Holdings new Installation at Valatie Falls, New York, and geothermal plants in Iceland.

 

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The Music Industry Flirts With Crypto and Reaps the Benefits

Recently, blockchain tech and cryptocurrencies have used their burgeoning popularity to pull in stars from the world of sport, not wanting to miss out on the next big thing on the block. However, musicians are some of the newbies on the front line of the new tech. Some have made more impact than others though.

Better known from his time with band Genesis, Peter Gabriel is an example of one who has no intention of dabbling. Gabriel is an ardent fundraiser for humanitarian causes and a supporter of the British Labour Party to which he has made significant donations.

His investment in the startup, Provenance, was undisclosed but clearly, it’s now contributing towards the company’s expansion of its product. Through Provenance, Gabriel’s money helps provide transparency to food transportation, basically giving the public a better idea of exactly where their food comes from and how it gets there. The Provenance blockchain-based application is predicted to be used in over 1,000 food businesses by 2025.

The ex-Genesis singer and drummer can now add his name to the list with other prominent personalities promoting ICOs over social media in the past year, such as Paris Hilton, Floyd Mayweather, and Katy Perry.

Islandic enigmatic singer Bjork wants her music out there and be purchased with crypto, to which end she hooked up last year with London based Blockpool, allowing her fans to exchange Litecoin, Dashcoin, and AudioCoin for her 2017 album Utopia.

Singer Imogen Heap commented that cryptocurrency has helped her in her recent projects too, particularly with her release of the song Tiny Human on the Ethereum blockchain in 2015, allowing people to download the song in exchange for Ether:

“People paid USD 1, or 1 ETH, which was equal to USD 1 at the time,” she said. “That was USD 200. I didn’t think anything of it and then, of course, it went massively up and I took a bit out and put it into the project, and then it went massively down. It went up to GBP 200,000.”

Senegalese singer AKON with his cryptocurrency Akoin also made the headlines amid plans to build a crypto city, but others from the music industry are getting involved in the blockchain, such as Kanye West.

Never to be outdone, rapper Kanye West tweeted happily earlier this year about blockchain and his version of a digital music service Spotify called Yeezy Sound, aimed to be a decentralized application that would incorporate cryptocurrency. That plan clearly is still in the pipeline, although the trademark applications are in.

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South Carolina Startups Get Green Light After Operation “Cryptosweep”

The Office of the Attorney General of South Carolina has given the go-ahead for two startups to resume business in the southern US state.

The Securities Division has removed cease-and-desist orders previously served against ShipChain and Genesis Mining for being accused of being in violation of state law as part of “Operation Cryptosweep” launched by the North American Securities Administrators Association earlier this year, as reported by Bitcoin News. The Statement by the Attorney General’s Office stated at the time:

“It is in the public interest, for the protection of investors, and consistent with the purposes of the Act that Respondent be ordered to cease and desist from engaging in the above-enumerated practices, which constitute violations of the Act, and pay an appropriate civil penalty for its wrongdoing.”

Shipping platform ShipChain refuted the accusation that its token sale wasn’t conducted in compliance with securities laws and that it was “not aware” that SHIP tokens were even offered to South Carolina residents as the sale was conducted out of state before being registered there.

The company launched in 2017 in California, reportedly raised USD 30 million in a private token sale in January. It was set up to deal with logistic issues which currently blight the industry to the tune of USD 50 billion annually on lost or stolen cargo.

The other company, Genesis Mining had been accused by the South Carolina Attorney General’s Office Securities Division of selling unlicensed securities and although the order to cease and desist has been dropped, no further details were given. The Icelandic company, founded in 2013, is the largest crypto mining consumer of power in Iceland and one of the largest companies offering Bitcoin mining services.

US States continue to legislate for cryptocurrency and blockchain activity in order to regulate for a rapidly growing fintech impact as more companies choose to do business in the country.

Nebraska, Florida, Arizona, Nevada, and Vermont, along with Maine, Hawaii, Illinois, and North Dakota are some of the many US states notably either in the process of presenting bills, enacting legislation or actively utilizing blockchain in state legislation.

 

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Stolen Icelandic Bitcoin Miners Found in China?

Police in Tianjin, China have seized 600 Bitcoin mining rigs, exactly the same amount of machines that were stolen in Iceland during a series of heists in December and January. The Bitcoin mining farm caused a short circuit on its electricity meter and was stealing power; electricity authorities noted a 28% increase of power loss on one of their lines prompting an investigation.

It is estimated that if the illegal operation wasn’t stopped it would have cost hundreds of thousands of Chinese yuan (1 USD = 6.3 CNY) per month of electricity, making it one of the biggest power theft cases in recent years. Bitcoin mining utilizes a tremendous 65 TWh of electricity worldwide per year, approximately the same amount of energy consumed by the entire Czech Republic.

Icelandic police had been tracking electricity usage across their country in hopes that once the stolen machines were plugged in they would cause an abnormal spike in electricity usage. This was perhaps the only way they would ever track down the missing Bitcoin mining rigs, since the thieves would likely use the machines to turn a big Bitcoin profit rather than to try and sell them to someone else.

Eleven people were initially arrested in Reykjavik, Iceland after the thefts occurred in December and January, but only two were kept in custody. A reward of ISK 6 million (Icelandic krona, approximately USD 60,000) has been offered by the owners of the stolen Bitcoin mining rigs for information leading to their recovery.

A news agency contacted Icelandic police regarding the seizure of the 600 rigs from the illegal Chinese Bitcoin mining farm, resulting in the Icelandic police sending an inquiry to Chinese police. So far, Icelandic police have not received a response, but once communication is established it will be possible to verify with serial numbers whether the seized machines are in fact the stolen machines from Iceland.

 

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“Big Bitcoin Heist” Escapes on Icelandic PM’s Plane

Robbery suspect Sindri Thor Stefansson has escaped from custody and fled to Sweden on a plane which was reported to have been carrying Icelandic Prime Minister Katrin Jakobsdottir.

Stefansson was being detained on suspicions of being the mastermind behind what has become known in Iceland as “the big Bitcoin heist”, the robbery of 600 computers used to mine Bitcoin.

He escaped from the Sogn open prison in rural southern Iceland early on Tuesday and boarded a plane at Keflavik International Airport some 95km away. He was only reported missing after the flight to Stockholm had taken off.

Stefansson’s plane was also reported to have been carrying the Icelandic prime minister who was on her way to a meeting in Stockholm with five Nordic prime ministers and India’s Prime Minister Narendra Modi.

In what is thought to be Iceland’s biggest theft, the 600 computers worth 200 million Icelandic krona (ISK) – about USD 2 million – were reportedly stolen in four separate burglaries. Stefansson, thought to have been the brains behind the heist,  was one of 11 people arrested. Police have arrested 22 people including a security guard.

Iceland has now become a centre for cryptocurrency mining due to the combination of plentiful renewable energy sources and a cold climate, suited for mining due to low electricity tariffs and low cooling costs. Lower costs generate higher profits for cryptocurrency miners, which have created a situation in Iceland where electricity consumption for mining has overtaken household use.

As yet, the computers haven’t been recovered and the owners have put out a USD 60,000 reward for their recovery. An international warrant has been issued for Stefansson’s arrest and Swedish police are now involved in the search. Several people, including the suspect’s wife, have been questioned by police but no arrests have been made, according to local media.

Iceland with its population of only 340,00 is reputed to have one of the world lowest crime rates.

 

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