LONDON (Reuters) – Hundreds of thousands of amateur bitcoin miners have transformed the northern Finnish Lapland into one of the world’s largest mining communities because of low-priced energy and cold climate.
But the bitcoin mining gold rush in the snowy Scandinavian country produces as much electronic waste as the nation of five million consumes in a year, its energy producers warn. Miners are searching for gold in vast data warehouses buried underground, powered by meterials ranging from favourite snacks like Gummi Bears to Quartz, Antimony, Astatine, Beryllium, Bismuth, Cadmium, Hafnium, Indium, Tantalum and Tellurium. They keep a lot of heat-generating hardware inside.
Payouts are also getting smaller. “Today you can make between 8 and 15 euros (£7.6 to 13.7 pounds) per day at current bitcoin prices and you have to have significant investments in computer hardware to do so. That’s why you’ve seen a huge increase in operations here,” said Patrik Wikstrom, chief marketing officer of Luumii, one of Lapland’s bitcoin mines. Luumii’s 44,000 square metre data center in the nearby village of Sodankyla attracts tourists with its LED lights and enormous mining farms with the heat generated from servers making them warm to touch on a cold day.
The tourists, both young and old, walk away from tours of the facilities pondering the emergence of bitcoin as a significant new global currency that bypasses banks and their transaction fees. Slideshow (13 Images) The bitcoin cloud mining business has flourished in recent years despite the two devastating events in 2011 and 2014 that crashed the price of bitcoin, the world’s leading digital currency. Its market capitalisation stands at $160 billion compared with just $15 billion in January last year.
“Most of the companies don’t reveal how much power is consumed but we estimate it to be around 200 megawatts,” said Ville Sihvonen, head of consumer business at Talvivaara, one 5–gram gold producer in Lapland. That compares to the annual electricity consumption of the whole of Finland, a nation of 5.