End of Bitcoin mining?

We told you yesterday that one of America's leading mining companies, Giga Watt, is collapsing. A few days ago, we dealt with the situation in China, where the mining farm also, due to strict controls, is slowly coming to an end. The fact that the situation for miners is very bad, says today's current report, this time from Europe. 

 

End of cheap energy for miners in Norway 

According to the local news portal Aftenposten, the government has decided that miners in the country will have to pay a normal sum for consumed electricity, as early as the New Year.  Several mining companies currently have de facto electricity in a few small ones. To be exact, they receive a discount at the price of electricity the same as the large industrial enterprises in the country. Expressed in figures, the price is charged at only 0.48 øre (0.00056 dollars) per kilowatt-hour instead of a standard rate of 16.58 øre ($ 0.019). This is only 2.8 percent of the standard rate. 

"Norway can no longer offer huge tax concessions for the" dirtiest part "of the crypto industry at the end of which Bitcoins are being used. This activity requires a lot of energy and also generates large greenhouse gas emissions around the world, " 

one of the representatives of the Norwegian Parliament, Lars Haltbrekken, said in a report. 

If the New Year really comes to end the subsidies, Bitcoin will also be forced to pay higher taxes, which will lead to a further reduction in their net profit. All this, at a time when the current low prices of cryptocurrencies are exerting considerable pressure on the heavy industry.  It is worth hundreds of thousands of dollars worth of energy, including the collapsing US company Giga Watt whose total debts, according to published documents, amount to nearly $ 7 million. 

 

"It's shocking" 

The proposal to cancel the aid was allegedly proposed by the Norwegian Tax Administration, an agency that falls directly under the Ministry of Finance of this Nordic country. Subsequently, this proposal was approved and incorporated into the state budget for 2019.  Roger Schjerva, the chief economist of ICT Norway, who has described this decision as shocking. According to him, the framework conditions were changed without any discussion, consultation or dialogue with the mining industry. He added that the country should not say NO to the income and new jobs that mining crypto brings. 

 

Conclusion 

As we can see, generating profits in the current precarious market situation is really very challenging in this sector, despite increasingly better technologies and newer miners. In addition, the loss of such cheap electricity is something that will only be very difficult to replace and may also affect the performance of the entire Bitcoin network. There is nothing else, just hoping that we will soon get some more optimistic news.