Iceland to consider taxing crypto-mining due to energy consumption

Cezar Renta

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Mining is still considered a profitable affair, even in the current market, as we saw cryptocurrency prices go well down under 50-70%. While GPU and CPU mining is a popular setup for most miners, the market witnessed a continuous rise and adoption of ASIC miners, which eliminate the hassle of building your own mining rigs, hunting for parts and managing the whole software-hardware situation. Coupled with the rise of Bitcoin in December 2017, it led to a massive growth in mining farms and has consequentially led to an increase in GPU/ASIC prices and the demand for cheaper electricity.

Iceland is one of those few countries that runs on renewable energy on top of a cold climate, making it a preferred country for miners to set-up shop. It’s estimated the energy consumption in Island for 2018 will reach or surpass 100 megawatts, which is double its current consumption. Introducing a tax for mining is something that will come eventually, as we start seeing more officials such as Pirate Party’s Smari McCarthy suggesting such action.

It remains to be seen how the Icelandic government will treat this business model given the lack of crypto regulations in the country. Some fear that by taxing miners, the government will begin a sleuth of regulatory efforts hitting future ICOs or individuals that want to trade cryptocurrencies.