Norwegian lawmakers have passed a new law requiring data centers to register with the government and report their activities, including crypto mining operations. The law aims to regulate energy consumption and prioritize socially beneficial services. Despite industry backlash arguing that crypto mining utilizes sustainable energy and supports the Norwegian economy, the government maintains its stance against the practice, deeming it environmentally harmful and undesirable.

Norway Moves to Crack Down on Cryptocurrency Mining, Sparking Industry Outrage

In a controversial move that has sent shockwaves through the cryptocurrency industry, Norway's parliament has passed a law imposing strict reporting requirements on data centers housing cryptocurrency mining operations. The new legislation aims to limit the energy consumption associated with the mining of cryptocurrencies like Bitcoin, which has become a major concern for Norwegian authorities.

According to Digitalization Minister Karianne Tung and Energy Minister Terje Aasland, the government's primary objective is to effectively prohibit crypto mining in the country.

"We intend to regulate the industry in a manner that allows us to reject projects that we deem undesirable," Tung stated in a recent press conference.

The newly enacted law, which is unprecedented in Europe, mandates data centers to register with the government, provide ownership and management details, and specify the services they offer. Aasland emphasized that this measure is necessary to ensure that Norway's energy resources are allocated to "socially beneficial" initiatives and infrastructure, excluding crypto mining.

"Cryptocurrency mining is associated with significant greenhouse gas emissions and represents a type of business that we do not welcome in Norway," Aasland declared, echoing Tung's sentiments.

Bitcoin mining is a global industry that involves the use of powerful computer hardware to solve complex mathematical equations in order to generate new units of Bitcoin. A 2022 report by Arcane Research revealed that Norway accounted for 0.77% of the global Bitcoin hash rate, a disproportionately large share considering the country's relatively small size. This significant contribution is primarily attributed to Norway's extremely low electricity costs, which have made local miners highly competitive.

"We do not welcome crypto miners in Norway," Aasland reiterated. "We seek to attract businesses that contribute positively to society, and the computer industry, which serves the greater good, is of particular importance to us."

However, the Norwegian government's actions have drawn strong criticism from industry experts, who argue that Aasland's claims about crypto mining lack factual basis.

"Bitcoin mining boasts an astonishing 55% sustainable energy utilization rate, surpassing any other global industry or major industrialized nation," CH4 Capital co-founder Daniel Batten tweeted on Monday.

"Norway's Minister of Energy, Terje Aasland, has demonstrated a profound lack of understanding regarding energy, Bitcoin, and emissions. His misguided statements have set Norway on a regressive path."

Furthermore, critics point out that Bitcoin miners do not directly emit greenhouse gases but rely on the emissions associated with their underlying power source. Norway, in particular, derives most of its electricity from renewable hydroelectricity, which has attracted Bitcoin miners to the country in the first place.

"The government's authority to determine who has the right to consume energy is inherently discriminatory," Batten added. "Aasland has no qualms about individuals using energy for activities like watching pornography (which consumes significantly more energy), yet he objects to the use of energy for Bitcoin mining."

Edited by Andrew Hayward