Multiple Norwegian crypto mining firms are currently facing a number of drawbacks in the wake of Norway’s budget cut announcement which will ax the discounted power tax rate for crypto mining operators beginning January 2019, prompting miners to consider other neighboring countries as an alternative, including Sweden.
As CEO of the Swedish data center company Boden Business Agency Eric Svensson recently confirmed in a report published November 24, a number of crypto miners have expressed interest in establishing operations in Norway’s Scandinavian neighbor.
So far, interested crypto mining firms have increasingly been drawn to the municipality of Boden where Svensson’s agency is currently headquartered. As it stands, around 10 crypto mining firms are already based in the municipality and have continuously been attracting even more mining operators largely due to its current tax for data centers, which is currently pegged at approximately 0.5 øre per kilowatt-hour.
Among the firms currently considering alternative European jurisdictions include Troll Housing, who previously announced plans of opening a data center in Fræna, Norway by next month. However, two days following its agreed 2019 budget, the firm had lost a major contract with a foreign operator.
Crypto mining giant Bitmain has recently been officially advised by the firm’s Norwegian partners to terminate its operations in the country, prompting the mining firm to consider migrating operations of its Norwegian subsidiary.
As Bitmain’s international sales manager Julie Hvideberg stated in a previous report published by local news outlet E24:
“We are a global company and can move to Sweden or Denmark, but our Norwegian partner loses a big contract.”
Explaining the firm’s move, Hvideberg went on stressing that it would prove far too difficult to maintain its Norwegian subsidiary primarily due to the forthcoming implementation of the amended tax rate and is now eyeing Sweden as a more viable alternative.
While the slated electricity tax payments increase is expected to generate over million kroner ($1,160,500) in revenue for Norway, Svensson emphasized that mining firms and other data centers also present positive benefits on the country’s economy.
As Svensson added:
“As a result of revenue and activity in the [Boden] municipality, we have started building Boden Business Park, where we will create hundreds of jobs.”
Aside from Sweden, a number of other neighboring countries in the Nordic region may also serve as a more viable option compared to Norway, including Iceland, which also offers relatively inexpensive electricity rates. In Iceland, mining a single Bitcoin costs only roughly $4,746 as of January 2018, a stark contrast compared to other countries where mining 1 Bitcoin would cost an average of $10,000, according to data aggregated by EliteFixtures.com.