Key takeaways:
- The Canadian bitcoin miner Hut 8 is leaving its Drumheller, Alberta, location owing to power outages and rising energy expenses.
- As of now, all of the company’s Bitcoin miners will be moving to its Medicine Hat, Alberta, Canada, location.
The Canadian bitcoin miner Hut 8 is leaving its Drumheller, Alberta, location owing to power outages and rising energy expenses.
Hut 8’s Drumheller mining operation, which mines 1.4% of the company’s Bitcoin at a cost of about 11% of its hash rate, is set to close immediately, according to the March 6 release. Hut 8 CEO Asher Genoot stated in a statement:
“Following a comprehensive analysis, we have determined that the profitability of Drumheller has been impacted significantly by various factors, including elevated energy costs and underlying voltage issues,”
Currently, all of the company’s Bitcoin miners will be moving to its Medicine Hat, Alberta, Canada, location. According to a staff report, Hut 8 intends to uphold its lease at the location and retain the option to re-energize the site should market conditions improve.
Several issues have caused sector stagnation, including high energy prices, record mining difficulty, and the upcoming 50% reduction in Bitcoin mining incentives due to halving.
Energyrates.ca data shows that since 2017, the cost of power in Alberta, Canada, has climbed by 1,000% per kilowatt hour (kWh). Concerning the new plants’ excessive power use, the provincial government has also restricted Bitcoin mining.
Hut 8’s income for the first nine months of 2023 dropped by 57% year over year to CA$ 55,184 ($40,757), primarily due to the decline in Bitcoin prices during that period. Hut 8 currently makes up 1.3% of the total processing power on the Bitcoin network in terms of hash rate.
Hut 8’s shares dropped more than 23% in a single day on January 19 following claims made by short sellers that the company’s partner, USBTC, was having legal issues with a $725 million merger transaction.
Since then, Hut 8 has claimed that the study is full of errors, incomplete information, wild speculation, and baseless criticisms of others’ character. Jaime Leverton, the company’s former CEO, left on February 8.
