Best Countries for Mining Cryptocurrency In 2022

Best Countries to Mine Cryptocurrency In

Pack up your crypto mining business and jet set to one of these countries! 

The price of Bitcoin has risen since its arrival on the crypto market in 2009. Despite recent volatility, the price of a single Bitcoin is still a staggering US$24,130 as of August 8, 2022. Given the value of Bitcoin, it is no wonder that many professionals and amateur investors are eager to tap into the burgeoning market. 

However, there is a lot involved in setting up a crypto mining operation, such as the cost of equipment, hash rates and cost of electricity. Keeping these considerations in mind, the cost to mine a single Bitcoin has been estimated to be anywhere between US$13,000 as of July this year. Yet, the actual costs vary dramatically depending on where the cryptocurrency is being mined. 

Before we introduce to you some crypto mining-friendly countries, let’s look at the factors you need to consider when looking for a place to set up your crypto mining business.

Factors affecting crypto mining operations 

Electricity costs 

Electricity costs are a major factor in determining how expensive a crypto mining venture can be. Thus, the smart choice is to move to a country where electricity costs are low. One such country is Venezuela, where electricity prices are as low as a penny (US$0.01) per kWh of electricity.  

This makes Venezuela appear to be a great country for mining cryptocurrency. At a cost of US$531 per coin, Venezuela is the cheapest country for crypto mining based on electricity costs. That, coupled with Venezuela’s extremely high inflation rate of being close to 3000% in 2020, many Venezuelans have turned to crypto mining, hoping that it can be a way out of hyperinflation. 

However, cheap electricity does not cut it for miners, as other problems, such as power outages and slow internet speeds, affect the profitability of mining crypto for miners in Venezuela. Besides, before crypto mining became a legal and well-regulated activity in Venezuela in 2020, another major risk for mining activities in the country were arrests and raids. Back in 2017, the country cracked down on Bitcoin mining by tracking down heavy power consumption. According to some miners, the Venezuelan government also saw crypto as “a threat to the already weak Bolivar (the country’s currency) and to its strict rules about capital flight”. 

The introduction of guidelines and regulations in the sector does not mean that everyone can mine crypto in Venezuela now. For those who want to mine crypto legally in the country, they have to get a permit from Sunacrip, the country’s crypto watchdog. In 2021, Venezuelan authorities seized more than 100 miners and mining farms running without permits.

Internet speed and costs 

Mining operations are entirely based in the digital realm. This means that to run a successful Bitcoin mining business, a fast and reliable internet connection is of vital importance. In terms of internet speeds, Jersey in the British Isles in Europe would be the best country to move to. The country boasts a download speed of 274.27 Mbps (megabytes per second), which is nine times faster than the global average. 

Just because a country has fast internet, does not mean that its internet is cheap. In fact, some of the countries with the best worldwide internet speed, the Netherlands (107.3 Mbps), Luxembourg (107.94 Mbps) and Iceland (191.83 Mbps) have high monthly internet costs. When it comes to price, Syria emerges as the best country for crypto mining. Average monthly broadband internet costs in the country are US$2.15 per month. 

Climatic favorability 

Bitcoin mining generates a lot of heat, so much so that it has the capacity to push global warming above 2°C. Besides being bad for the environment, this heat is also bad for the devices being used to mine crypto. Overheating can shorten the life of a computer’s hardware and make it run slower than a cooler computer. 

The best way to prevent this is by placing your crypto operation in a colder country. One of the best countries with regard to climate is Sweden, which has an average temperature of 2.1°C. Innovators in the country have even been trying to re-purpose the heat generated by Bitcoin mining. Genesis, one of the country’s large-scale crypto mining companies, uses the heat generated by its operations to provide heat to a greenhouse that produces fruits and vegetables.

Crypto mining-friendly countries

Taking the above factors into account, certain countries emerge as the best locations for crypto mining. These include:

Iceland

As we have already discussed, Iceland has high internet speeds. What’s more, electricity costs are also cheap in the country. Commercial electrical service in the country costs US$0.12 kWh. Moreover, 100% of this electricity supply comes from hydroelectric dams and geothermal plants. These factors have made the country a popular place for crypto mining, as nearly 8% of all global Bitcoins have been mined in the country. The country also does not have any particular legal restrictions on crypto mining. 

Norway

Dubbed a “green oasis” by Cointelegraph, Norway contributes close to 1%  to the global hash rate of Bitcoin. With an average internet speed of 88.67 Mbps, Norway is one of the countries with the best internet speeds for crypto mining. When it comes to electricity supply, the country is heavily dependent on hydroelectric power, and electricity costs are US$0.143 per kWh for households and US$0.127 for businesses. 

The cold weather and mild summers in Norway also allow mining equipment to stay cool. The country does not recognize Bitcoin but also does not prohibit people from owning and investing in them. Moreover, in May this year, the proposal to ban Bitcoin mining was overturned by the Norwegian Parliament, indicating the government’s positive attitude towards crypto mining in the country. 

Norway also reduced the power tax for energy-consuming businesses (like data centers) from US$0.017/kWh to US$0.0006/kWh in 2016, making it an attractive spot for Bitcoin miners who run energy-intensive operations.

When looking for a country to set up a crypto mining business, it is important to consider how the country fares over a wide range of factors besides internet and electricity costs. One of these determining factors is the region’s legal regulation of crypto, which varies from country to country and can change quite frequently and rapidly. Although the industry has been hit by price crashes in the past couple of months, with more and more people and businesses using crypto, the trend is not going away anytime soon.

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Header image courtesy of Pixabay

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