With the increasing popularity of cryptocurrency today, a lot of nations across the globe has embraced its efficiency, uses and even benefits perhaps.
And, Iceland will not leave behind those huge nations in undermining the crypto fever. Latest report suggested that Iceland’s crypto mining uses too much energy that could lead to electricity run out.
In recent months, the value of bitcoin may have stumbled in recent months, but in Iceland it has known only one direction so far: upward.
It is not a wow outcome, basing the stunning success of cryptocurrencies around the globe has had a more unexpected repercussion on the island of 340,000 people: It could soon result in an energy shortage in the middle of the Atlantic Ocean.
As Iceland has become one of the world’s prime locations for energy-hungry cryptocurrency servers — something analysts describe as a 21st-century gold-rush equivalent — the industry’s electricity demands have skyrocketed, too.
For the first time, they now exceed Icelanders’ own private energy consumption, and energy producers fear that they won’t be able to keep up with rising demand if Iceland continues to attract new companies bidding on the success of cryptocurrencies.
Companies have flooded Iceland with requests to open new data centers to “mine” cryptocurrencies in recent months, even as concerns mount that the country may have to slow down investments amid an increasingly stretched electricity generation capacity.
“There was a lot of talk about data centers in Iceland about five years ago, but it was a slow start,” Johann Snorri Sigurbergsson, a spokesman for Icelandic energy producer HS Orka, told The Washington Post.
“But six months ago, interest suddenly began to spike. And over the last three months, we have received about one call per day from foreign companies interested in setting up projects here,” Siguebergsson added.
“If all these projects are realized, we won’t have enough energy for it,” he speaks to BBC.
Explaining more on the nature crypto mining and other mechanism it attached with, every cryptocurrency in the world relies on a “blockchain” platform, which is needed to trade with digital currencies.
Tracking and verifying a transaction on such a platform is like solving a puzzle because networks are often decentralized, and there is no single authority in charge of monitoring payments. As a result, a transaction involves an immense number of mathematical calculations, which in turn occupy vast computer server capacity. And that requires a lot of electricity.
An increasing concern that Iceland should address and find appropriate solutions.