Iceland, country of geysers and now of Bitcoins

In the heart of Iceland’s lava fields stands a Bitcoin factory among the largest in the world. Hightech workshop that produces virtual gold, the site is ultra-secure and its precise location is kept secret to avoid covetousness.

Iceland has become a paradise for cryptomeria « miners » like Bitcoin, emitted by servers as powerful as they are energy-hungry, thanks to its hot-water-logged basements that provide electricity in abundance and at good prices.

Unlike the dollar or the euro, Bitcoin is not issued by central banks but « mined », or created in computer « farms ».

In the Icelandic volcanic desert, a silver plated hangar with an innocuous appearance houses machines, nearly four other buildings to which will soon be added two brand new warehouses.

This Genesis Mining « farm » bears the dubious name of the first encryption machine, Enigma, used by the Nazis during World War II.

Inside the hangar, tens of thousands of « mining rigs » line up over 400 m2, creating a stunning buzzing sound close to that of a jumbo jet on takeoff.

A mining rig is a kind of CPU with a motherboard, RAM memory, hard disk, processor and six graphics cards.

His role? Run complex algorithms to record a succession of authenticated and encrypted transactions. This technology called the « blockchain » is often described as the digital equivalent of an account book that would be inviolable and tamper-proof. In total, 12.5 bitcoins are created every 10 minutes on mining farms.

A polar wind that does good

«  Anyone can do this at home, without hindrance (legal) or technical limit, » explains Philip Salter, Genesis Mining’s representative in Iceland. But the colossal investment, the production and maintenance costs on an industrial scale – the only one capable of creating a bitcoin economy worthy of the name – were, says the 25-year-old German engineer.

Because the machines, connected to the sector, run 7 days a week, 24 hours a day.

Of the 17 million bitcoins in circulation in the world, a still modest part is « made in Iceland » but the small island of the North Atlantic intends to rise in power and recover the profits of the war launched by the Chinese authorities against this virual currency.

Iceland offers unique conditions in the world for the production of cryptomones, due to its cheap and 100% renewable geothermal energy.

The average kWh excluding taxes (0.065 euro) is half that of the European Union (0.114 euro), according to Eurostat data for 2016, which makes Iceland one of the most competitive nations in Europe after Serbia, Macedonia and Bosnia.

And the average annual temperature on the island is about 5°C. This is ideal to avoid overheating, and perfect to mechanically limit the need for energy consumption.

The polar wind is sucked in by a battery of fans, then filtered and mixed with the heat released by the computers – up to 80°C – and keeps the temperature of the mining stations between 5°C and 25°C.

Iceland displays complete

Previously Genesis Mining, created at the end of 2013, was based in Bosnia, its major competitors being in China or the United States.

Like her, many computer »farms » companies covet a place in Iceland.

« Demand has grown exponentially, especially in the last three months« , says Johann Snorri Sigurbergsson, development manager at HS Orka.

This is despite the volatility of Bitcoin, which is currently around 10,000 dollars after having approached 20,000 dollars in December and then dropped below 20,000 dollars in December.