New legislation passed in Norway may lead to increased examination for Bitcoin (BTC) miners, as the country takes steps to regulate data centers.
Starting next year, it is required that all data centers in the country undergo official registration. This includes providing details about the center’s management team and the specific digital services offered. Norway will be leading the way in Europe by implementing this new regulatory framework first.
Under the new law, the government aims to provide politicians with more comprehensive information about data centers located within their jurisdictions. This detailed insight will enable them to make informed decisions on whether to approve or reject these facilities. (Terje Aasland, Norway’s Minister of Energy)
“The purpose is to regulate the industry in such a way that we can close the door for the projects we do not want”
The announcement might lead to increased examination of Bitcoin mining operations within the country, adding to the challenges that miners are already facing due to the upcoming Bitcoin halving event. This event will cut in half the rewards given for creating new blocks on the Bitcoin network, potentially threatening the financial viability of Bitcoin mining businesses.
The crypto mining industry has been largely unregulated in Norway, added Aasland:
“[Crypto mining] is linked with large greenhouse gas emissions, and is an example of a type of business we do not want in Norway.”
The minister stated that they have no inclination towards businesses seeking low-cost energy extraction from the country.
Bitcoin miners under pressure
A significant number of Bitcoin mining businesses are now based in northern Norway due to its affordably priced electricity.
According to a 2023 report by local newspaper Dagsavisen, crypto mining companies in northern Norway consume almost equivalent amount of electricity as the entire Lofoten district.
However, Aasland pointed out that Bitcoin mining companies are not favored in Norway. Conversely, the minister expressed his approval for data centers that serve socially valuable functions, such as those acting as storage facilities, which he considered a crucial component of Norway’s social infrastructure.
Currently, the number of Bitcoin mining companies in operation within Norway is a mystery to the government. However, forthcoming legislation aims to provide additional information, which will then be utilized to continue Norway’s digitalization journey, as stated by Karianne Tung, the Norwegian Minister of Digitalization and Public Governance.
Bitcoin miners face increased strain leading up to this week’s halving event. Based on estimates from Markus Thielen, the chief researcher at 10x Research, approximately $5 billion in Bitcoin could be sold by miners in the ensuing months post-halving.
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2024-04-15 15:24