Hey folks,
I’ve been curious about why there aren’t many mining farms in Norway, especially since they’ve got around 95% green hydro energy and super cheap electricity rates (around 3.5 to 4 cents per kWh).
From what I’ve seen, the only mining operation there is this sketchy one I found => https://new-mining.co, and there’s practically no info about who’s behind it. No team details, no LinkedIn profiles, nothing.
Anyone got any thoughts on why there aren’t more mining projects in Norway given the low energy costs? Maybe there are some hidden taxes or something?
Appreciate any insights.
Larson311
This is because Norway taxes you on your cryptocurrency: https://www.skatteetaten.no/en/business-and-organisation/reporting-and-industries/industries-special-regulations/internet/tax-and-vat-on-virtual-currencies/ , so people making an organization to mine there will have to include their mining revenue in their tax returns and since mining rewards tend to be large, that will eat a significant chunk of profits, which are already on a thin margin in the first place.
Right. I forgot to mention that they had a tax subsidiary on electricity that was slashed for bitcoin miners 3 years ago. Profit impacts still apply though.
Another possibility is that anyone running mining farms in Norway doesn't create a website or publish their business details. Just chilling on their own.
Or, maybe there are no miners living there.
Something interesting I found online https://www.business-standard.com/article/markets/nordic-region-bitcoin-s-green-haven-is-running-out-of-surplus-electricity-121041700536_1.html outlines some of the reasons being tied to growing concerns of carbon emissions.
And according to article above the Nordic region does have mining activities going on, guess they aren't just public about it...
It's not really that, what I gleaned from the article is it's mainly about the surplus energy supply running out which caused power plants to significantly raise prices for their electricity for clients (such as bitcoin miners).
For Eu yeah, definitely.
For the rest of the world the advantage starts to fade, the only thing keeping it up is the cold climate and relative free of natural disasters.
Marathon pays 2.8 cents/kWh in Montana and under 5 cents (5.5c are $6.5cents) in Texas so there goes the competivity.
But the most important thing is that prices go up and down, depending on the amount they generate, because of the differences in rain it's not out of the ordinary to have spikes in imports, in 2019 imports went up by 50% while exports down by 30%, when things like this happen the increase is directly sent to the consumer. Plus, they have less and less maneuvering space, as NotATether said when you're not having a constant net surplus that allows you t pump tons of water in the pump storage t balance the grid when there are shortfalls you have no option but to raise prices.
As for taxes, what I dislike about Norway is that you're taxed on the value at the moment of receiving coins, so if you mined and got 100BTC at 60k but didn't sell till now it really sucks as you're taxed at $60k not $32k!!