Norwegian regulators are taking decisive action to rein in cryptocurrency mining activities through the implementation of a pioneering law aimed at data centres operating within the country.
As reported by local media outlet VG, the forthcoming legislation will mandate the official registration of data centres, requiring them to disclose comprehensive details about their stakeholders, including owners and key decision-makers, as well as the nature of services they provide.
This groundbreaking initiative positions Norway as the inaugural European nation to institute regulatory measures specifically targeting the data centre sector.
Digitalization Minister Karianne Tung articulated the objective behind the new law, emphasizing its role in selectively controlling the industry landscape: “The purpose is to regulate the industry in such a way that we can close the door on the projects we do not want.”
This legislative endeavour seeks to empower local government authorities with enhanced oversight capabilities over data centres, enabling them to make well-informed assessments when considering the approval or rejection of operational licenses.
Regulators anticipate that this regulatory framework will significantly bolster the management of Norway’s indigenous data infrastructure. Regulators have explicitly articulated their opposition to cryptocurrency mining endeavours.
Minister for Energy Terje Aasland underscored concerns about the substantial greenhouse gas emissions attributed to the crypto mining process: “It is associated with large greenhouse gas emissions and is an example of a type of business we do not want in Norway.”
Aasland reiterated Norway’s disinterest in enterprises that seek to exploit the country’s abundant reservoirs of inexpensive electricity.
Norway stands as Europe’s premier hydropower producer, with renewable energy sources constituting the primary source of its electricity generation.
Consequently, the nation has emerged as an increasingly attractive destination for cryptocurrency miners owing to the region’s low electricity costs.
Notably, a 2023 report revealed that mining enterprises in Northern Norway, where electricity rates are the most competitive, collectively consumed electricity equivalent to that of the entire Lofoten district.
Presently, regulatory authorities lack precise visibility into the number of Bitcoin mining entities operating within the country.
However, the impending legislation promises to shed light on this matter, thereby advancing Norway’s digitalization agenda, according to Minister Tung.
The intensified scrutiny from Norwegian regulators coincides with a broader downturn in the performance of the crypto mining sector.
Major Bitcoin mining firms, such as Marathon Digital Holdings and Riot Platforms, have witnessed continued declines in their stock values over recent weeks.
These developments unfold against the backdrop of the imminent fourth Bitcoin halving event.
Markus Thielen, Head of Research at 10x Research, has projected that Bitcoin miners may need to liquidate approximately $5 billion worth of the flagship cryptocurrency to sustain profitability post-halving.
