Quebec suspicious of bitcoin mining mania
Quebec has been trying its luck at becoming the next silicon-valley for the emerging sector of crypto mining.
At the same time, there are some authorities are doubtful; fearing a surge of demand for electric power could trigger blackouts, for the benefit of an industry that few fully understand.
Several old cocoa factories in Canada’s Quebec province have been converted into mining warehouses. Small holes have been made in the walls of the factories, for the processors to cool down.
Yessoulou Coulibaly, an entrepreneur who has around 7,000-odd computers hidden away in this industrial park at a center operated by Bitfarms, one of the emerging players of the cryptocurrency “mining” boom.
Quebec has been in a competition with Iceland, attracting miners by providing cheap electricity rates and its favorably low temperatures.
Recently in March, many Quebec municipalities slapped moratoriums on cryptocurrency warehouses and Hydro-Quebec public utility to halt new projects to get a better understanding of the technology and its long-term economic impact.
Among the first ones to stop was a small municipality of Bromont, in the east of Montreal, as the bitcoin operations started consuming about 30 of the 36 megawatts total excess power of the town.
Followed by its neighboring township of Brome-Missisquoi, which has also put a similar ban on new bitcoin mines.
Most of the business requests that we had in our region to open computer warehouses to mine cryptocurrencies would result in very little job creation,” said the town administrator, Robert Desmarais.
Marc-Antoine Pouliot, a Hydro-Quebec spokesman, added: “We can’t predict the future for this industry.”
Authorities, he explained, “want to see first how projects can be established in Quebec in a sustainable manner,” without ruling out a hike in electricity rates.
According to Pouliot, the craze began in September after China moved to regulate cryptocurrency trading.
Quebec has received proposals for projects that would require more than 9,000 megawatts power. The province has a Hydro capacity of 40,000-megawatt, equal to the power consumed by 83 percent of Quebec households.
Majority of the interest shown in Quebec is from China, followed by Russia after the first international blockchain summit to be held in Montreal in April.
In Quebec, “electricity is affordable, abundant and green,” Pouliot said, noting massive hydroelectric dams in the north generate most of the power. The cool weather also means factories require less air conditioning.
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