Bitcoin miners face tougher times ahead as the government scraps subsidized electricity for local cryptocurrency miners. This move comes amidst the dwindling price of virtual currencies which is already forcing some miners out of business.
Hard Knocks for Bitcoin Miners in Norway
According to reports in the local media, Bitcoin miners will no longer enjoy subsidized electricity tariffs in Norway. This move comes after a budget shakeup that sees the removal of such discounts. Thus, from January 2019, cryptocurrency miners in Norway will have to pay the standard electricity tariffs.
Commenting on the decision, Lars Haltbrekken, a representative of the Norwegian Parliament, said:
Norway cannot continue to provide huge tax incentives for the dirtiest form of cryptographic output as bitcoin. It requires a lot of energy and generates large greenhouse gas emissions globally.
This news coming on the heels of the current downward spiral in Bitcoin and other crypto prices will undoubtedly put more pressure on Bitcoin miners in the country. Presently, Norwegian cryptocurrency miners enjoy similar electricity subsidies as other energy-intensive industries.
The scrapping of electricity subsidies will see electricity costs for BTC miners shoot up by more than 3,350 percent. According to Forbes, it costs about $7,700 to mine one Bitcoin in Norway based on the present electricity tariff.
Reports indicate that many stakeholders in the country’s tech industry aren’t best pleased with the development. Roger Schjerva, the chief economist at ICT Norway – the country’s tech industry body, said the move could damage the government’s credibility regarding its support for the tech industry. According to Schjerva:
This is shocking. Budgets have changed framework conditions without discussion, consultation or dialogue with the industry. Norway scores high on rankings of political stability and predictable framework conditions, but now the government is gambling with this credibility.
Bitcoin Miners Going Out of Business
Outside Norway, the situation isn’t any better for some cryptocurrency mining establishments as the effects of the current market drop continue to bite harder. On Friday, Live Bitcoin News reported that US-based crypto mining company, Giga Watt filed for bankruptcy. The company even faces eviction from its base in Washington County.
While the genesis of Giga Watt’s travails traces back to before the current price crash, there are reports of mining centers being forced to decommission their hardware and the price slide continues.
Do you agree with Norway’s decision to terminate electricity subsidies for local Bitcoin miners? Let us know your thoughts in the comment section below.
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