Will Canada be the next mining mecca?

From cryptocurrency startups to major Bitcoin investors, people of all ages are rushing to join the massive Bitcoin trend. Cryptocurrency is creating a closer community in Montbier, Canada. And this phenomenon is becoming more and more common in Canada...

Mining becomes the new trend

Cryptocurrency mining (also known as "mining") is the process of recording digital currency transactions, verifying them, and storing them in a public ledger called a blockchain. This process is performed by miners, who use powerful computers to crunch cryptographic data to package blocks of transaction data. The transaction-related fees are awarded to the miners in the form of digital cryptocurrency. However, this process uses a lot of energy and requires that the temperature be kept to a minimum.

As cryptocurrency platforms such as Bitcoin continue to expand, Canada may soon be able to become a major global cryptocurrency mining location.

“Canada is on the verge of becoming a resource hub,” explained Cole Diamond, CEO of Coinsquare, one of Canada’s leading cryptocurrency exchanges. “I think there’s a new wave of activity happening right now, and we’re going to have a large-scale mining operation in the next few months.”

Support from the government... and a new home for the miners

As an immigration country, Canada is attracting more miners to settle down through policy incentives.

Taking China, one of the world's major mining locations, as an example, the local cryptocurrency mining industry is under pressure, and miners are turning their attention to regions with more relaxed and favorable policies. So far, the Canadian government has maintained a supportive attitude towards the cryptocurrency industry.

"A large number of digital currency miners are moving their operations and equipment to Canada, and they want to settle down," Cole Diamond said. "From what we know, some countries seem to be keeping a strict attitude towards cryptocurrencies, while Canada's attitude towards mining is quite positive."

According to Reuters, although some countries have not yet issued relevant regulations on the mining industry, there have been constant rumors of tightening policy supervision, and the relocation of mines and miners has become an inevitable choice.

At the same time, the Canadian government has taken comprehensive measures to pave the way for the increasingly prosperous cryptocurrency industry. As the birthplace of Ethereum and the incubator of many blockchain projects, the Canadian government has always held a positive attitude towards the cryptocurrency industry.

Recently, the Canadian federal government also launched a trial to make government research and grants more transparent by using blockchain technology. The trial will use Catena Blockchain Suite, a product built on the Ethereum platform.

Canada may solve mining energy consumption problem

As cryptocurrency mining becomes more popular, mining operations are using more and more energy.

“We have a situation where as profitability increases, the demand for mining equipment increases. At the same time, more and more people are tempted to join the competition for the cryptocurrency ‘reward’. That’s why the number of devices keeps increasing and the energy consumption keeps increasing,” explained Marco Marcovici, a cryptocurrency expert and consultant to HydroMiner, a hydroelectric crypto mining company.

Canada has an abundance of eco-friendly energy, which can play a huge role in attracting cryptocurrency miners to set up operations in the region. "Canada has a lot of cheap energy from hydroelectric power stations," Marco Marcovici added. "This is also why we are able to support large-scale mining."

Quebec or Manitoba?

So, which province in Canada has the most favorable tax policy?

If we look at the cost of energy consumption, Hydro-Quebec offers the lowest electricity rates in North America. The company says Quebec has had an energy surplus equivalent to 100 terawatt hours over the past 10 years. Global News previously reported that one terawatt hour of energy could power 60,000 homes in Quebec in a year.

A Hydro-Quebec representative recently claimed to have attracted more than half of the world’s largest blockchain players, following a series of events launched in 2017 to attract bitcoin miners. “We have at least three or four of the top five blockchain players in the world,” said David Vincent, director of distribution business development at Hydro-Quebec.

Although Quebec has begun to position itself as a place to mine "green Bitcoin", Manitoba is not far behind. Manitoba Hydro said it has received more than 100 inquiries from cryptocurrency miners in the past three months. Manitoba's investment enthusiasm mainly comes from Chinese investors, most of whom are attracted by Manitoba's cheap electricity.

However, it is worth noting that electricity prices in Manitoba may soon rise. According to Manitoba Hydro, Manitoba Hydro is applying to the province's Public Utilities Commission for approval of a 7.9% rate increase, which would take effect on April 1, 2018. In comparison, Quebec's application for a rate increase of just 0.7% is a good start.

Lower temperatures are an advantage

Mining equipment generates a lot of heat, which means lower temperatures provide a very ideal environment for mining Bitcoin and other cryptocurrencies.

"Cooling is a key issue, no matter where you are, cooling is very important. In order to use a lot of energy you have to equip large power supply equipment, which will cause overheating problems and affect operation. This will be a considerable investment, but it cannot be ignored." said Marco Marcovici.

He added that using water can further reduce cooling costs, which is an important part of HydroMiner's decision to build a hydroelectric operation. He concluded that the cooler temperatures combined with Canada's ample hydropower opportunities create an attractive combination for Bitcoin miners. "Canada is really great, it may become the number one mining mecca in the future!"

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If we list the factors that need to be considered in mining site selection, Canada's advantages include stable policies, cheap electricity and cold climate. These three points are enough to make Canada the first choice among many mining sites. The northern part of Canada with its superior comprehensive conditions is expected to attract a large number of mines to settle down. It is only a matter of time before it becomes the next mining paradise.