In recent years, the bitcoin (BTC) mining industry has found fertile ground in Sweden, where it is benefiting from the authorities’ efforts to make the national energy mix cleaner. BTC mining activity there is now one of the strongest in Europe. But it is threatened by increasing demand for electricity, with the economic recovery.
Foster economic recovery at the cost of BTC
In the context of economic recovery and rapidly increasing demand from manufacturing in Sweden, Energy Minister Khashayar Farmanbar raised the possibility of suspending the supply of electricity to mining companies in BTC. Arbitration that shows the will of the authorities to give priority to the development of the entire economic value chain in the country and not to give too much energy to BTC technology.
“We need energy for more useful things than bitcoin, to be honest (…) The Swedish economy is moving “from a period of administration to a very large expansion where our entire manufacturing industry is trying to electrify itself”said the leader, at the microphone Bloomberg.
Last year, the country had already raised the issue of banning BTC.
If the measure is implemented, miners will lose the preferential treatment they enjoy in terms of the purchase price of electricity, which should weaken their finances, slow down activity and ultimately force companies to leave the country.
For the time being, discussions are taking place at the level of the leaders of the energy sector, to find the best way to implement this measure. The press reports that two options are being considered. The first would be to maintain a sustainable feed in favor of mining companies that offer additional added value to the Swedish company. The other would be to limit the scope of the preferential tax treatment they receive, which would result in more taxes.
According to Erik Thornstrom, senior consultant for industry group Swedenergy, higher tax burdens would drive out miners and attract more companies in terms of added value.
In Europe, Sweden is one of the European countries with the most developed renewable energy sector. More than half of the energy mix is made up of clean energy. This inexpensive energy has attracted BTC miners in recent years. But with the post-covid-19 economic recovery, the State wants to ensure that this new capital will not lack energy to operate. This, in order to encourage diversification and economic growth.
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Luc Jose Adjinacou
Far from dampening my enthusiasm, an unsuccessful investment in cryptocurrency in 2017 only increased my enthusiasm. So I decided to study and understand the blockchain and its many uses and share my pen knowledge related to this ecosystem.