Their national currency is in hyperinflation. As a crypted currency it serves drug cartels, online scammers and other underground businesses.īut advocates like Streng have a different perspective, considering bitcoin’s lack of central authority the currency’s greatest strength. Over the past year, the region’s energy supply has been nearly exhausted and HS Orka is expanding its capacity with a hydroelectric dam in the remote Tungufljot river, near the Great Geysir hot spring tourist attraction.īitcoin has lost half of its value of the past year įluctuating prices and high transaction costs make the virtual currency useless for day-to-day payment – although Streng, who addresses tech crowds around the world, disagrees he insists he used bitcoin just last week to “pay for a nice hotel”.Īnonymity, experts say, is the only real advancement bitcoin has over other forms of payment. HS Orka provides electricity to the southwestern Reykjanes peninsula where the cryptocurrency “farms” are largely based. “The computers are just always on, always running on maximum capacity.” “They are great customers,” said Johann Snorri Sigurbergsson, business development manager at the local energy firm HS Orka, as he praised the bitcoin farms for steady and stable energy usage. The move is expected to load pressure on Iceland and other areas still welcoming the business.
Tomas Gudbjartsson, environmentalist and cardiologist in Reykjavik, is concerned about bitcoin mining’s harmful effects on the land Īccording to Dutch bitcoin analyst Alex de Vries, who operates a Bitcoin Energy Consumption Index on the website Digiconomist, bitcoin energy consumption is still on the rise globally, after receding late last year following a drop in value.Įarlier this month, authorities in China, where coal-rich regions host the world’s biggest cryptocurrency mining farms, announced plans to crack down on the industry completely, claiming massive energy waste and pollution.
In the case of bitcoin, a total of 21 million can be mined, with about 3.3 million left to create.Īs more bitcoins enter circulation, more powerful computers are needed to keep up with the calculations – and that means more energy. In return, the miners claim a fraction of a coin not yet in circulation. “We will simply destroy these areas if we continue.”Įnergy demand has developed because of the soaring cost of producing and collecting virtual currencies.Ĭomputers are used to make the complex calculations that verify a running ledger of all the transactions in virtual currencies around the world. “Iceland still has one of the biggest wilderness areas in Europe,” said environmentalist Tomas Gudbjartsson, protesting the expansion of energy infrastructure. Geothermal power plants are built over natural hot spring areas, spoiling the unique landscape. Hydroelectric dams sink untouched land under water and alter rivers and waterfalls. Marco Streng, a German national, created the world’s largest cloud bitcoin mining company īut this “green” energy is not entirely environmentally friendly. Iceland’s energy comes from hydroelectric dams and geothermal power plants, creating electricity without carbon emissions. The new industry’s relatively sudden growth is raising serious concerns for its environmental impact. Being a bitcoin entrepreneur is the only job Streng has ever held. Raised in Bavaria, Germany, the 29 year old was a maths prodigy on a glowing academic track until he began collecting digital coins. “People don’t give me a funny look any more when I explain my plans,” Streng told Al Jazeera. Powerful computers, stacked inside long and grey warehouses, use more electricity than all Icelandic homes combined, according to a local energy firm. The strip is now where international companies “mine” for bitcoins and other virtual currencies.
This was in 2014 and the barren, windswept ground then seemed like an unlikely place for a financial district. He travelled no more than three kilometres from the airport terminal to an abandoned airstrip built by allied forces in World War II. His bitcoin computers were using more energy and the remote North Atlantic island had massive amounts of electricity at inexpensive rates. Reykjavik, Iceland – Marco Streng first visited Iceland to solve a simple problem.