Norwegian Bitcoin miners are facing tougher times ahead after its government removes the subsidized electricity for local crypto miners. The move comes amidst dwindling cryptocurrency prices, which force several miners out of business.
Local media reports indicate that Norwegian Bitcoin miners will no longer enjoy subsidized electricity tariffs in the country. Starting January 2019, crypto miners will need to settle the standard electricity tariffs.
“Norway cannot continue to provide huge tax incentives for the dirtiest form of cryptographic output as bitcoin. It requires a lot of energy and generates large greenhouse gas emissions globally,” Norwegian Parliament representative Lars Haltbrekken commented.
With the present downward spiral in cryptocurrency prices, the news is likely to put more pressure on Norwegian crypto miners, who currently enjoy electricity subsidies like those of other energy-intensive industries.
Scrapping electricity subsidies will shoot up power costs for Bitcoin miners by over 3,350%. In Norway, mining one BTC costs around $7,700 based on current electricity tariff, according to Forbes.
Many Norwegian tech industry stakeholders are not best pleased with the development. As per ICT Norway chief economist Roger Schjerva, the move could damage the credibility of the government regarding its support for the sector.
“This is shocking. Budgets have changed framework conditions without discussion, consultation or dialogue with the industry. Norway scores high on rankings of political stability and predictable framework conditions, but now the government is gambling with this credibility,” Schjerva stated.
The situation is not any better for many crypto mining establishments outside Norway, as the impact of the present market dip continues to bite harder. Last week, the US-headquartered cryptocurrency mining company Giga Watt has filed for bankruptcy and is facing eviction in Washington County. Some mining centers are also reportedly being forced to decommission their hardware, and the price crash continues.