Hut 8 Closes Bitcoin Mining Facility Due to Power Disruptions and Rising Energy Costs
Hut 8, a Bitcoin mining company, has announced the closure of its mining site in Drumheller, Alberta, Canada, citing power disruptions and rising energy costs as significant factors.
The decision comes amid escalating energy costs and power disruptions, which are severely impacting the site’s profitability. The Drumheller facility, which currently contributes approximately 1.4% of Hut 8’s Bitcoin production but consumes around 11% of its hash rate, will be shut down immediately.
Asher Genoot, CEO of Hut 8, explained that after conducting a thorough analysis, it was determined that the profitability of the Drumheller site had been significantly impacted by factors such as elevated energy costs and underlying voltage issues. Consequently, all of the company’s Bitcoin miners will be relocated to its Medicine Hat facility in Alberta, Canada.
“We have determined that the profitability of Drumheller has been impacted significantly by various factors, including elevated energy costs and underlying voltage issues.”
Despite the shutdown, the company will maintain its lease on the Drumheller site, leaving the door open for a potential reactivation if market conditions improve.
Several factors, including high energy costs, record mining difficulty, and the anticipated Bitcoin halving and reducing mining rewards, have contributed to stagnation in the sector. In Alberta, Canada, electricity prices per kilowatt-hour (kWh) have surged by 1,000% since 2017, while concerns over power consumption have led the provincial government to restrict new cryptocurrency mining projects.
Unlike many crypto miners, including firms such as Core Scientific and Riot Blockchain, who were forced to sell at least part of their mined Bitcoin
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