Bitcoin and crypto mining needs the perfect balance of energy costs and revenue to be a viable investment venture. In the case of energy, cheap rates are preferred. There is also the aspect of cooling the mining machines that is usually taken care of by air conditioning in traditional data centers.
But why use extra energy when you can use naturally occurring cool air found in specific regions and/or countries across the globe?
With the price of all cryptocurrencies decreasing in the current bear market, reducing operational costs of mining is very desirable.
Why Mongolia Has Emerged as the Preferred Mining Destination
This is where Mongolia is emerging as a preferred destination for crypto miners to set up shop based on the two factors of cheap electricity and cold weather to aid in cooling. These ideal conditions has attracted a number of Japanese miners one of which is the e-wallet company of Ginco.
Ginco is operating two mining farms in Ulaanbaatar: Mongolia’s capital city. One of the facilities is in an underground area of a condominium complex with over 600 mining computers. The locality began mining operations last October and plans on adding an extra 1,000 units early this year.
Yuma Furubayashi, CEO of Ginco Mongol, further elaborated that energy cost is a key factor in calculating profits from crypto mining in the current market conditions. With the cost of electricity in Mongolia being a third of what it is in Japan, the landlocked nation is ideal for mining activities.
Crypto Winter is Unforgiving
With the value of Bitcoin falling from $20,000 to current levels of $3,600 in a period of a year, many BTC and crypto mining firms have either downsized or closed shop completely. One good example is Bitmain that had high hopes of registering an IPO on the Hong Kong Stock Exchange. However, due to the declining value of BTC and operational difficulties brought about by the November hash wars, the firm has seen a massive restructuring that has led to a vast majority of their staff being let go. Its CEO, Jihan Wu, is also rumored to be stepping down. Also, all hopes of an IPO have continued to dwindle with time.