Norwegian Government’s Decision to Cut Miner’s Fee has been Criticized by Hive Blockchain Technologies

Norwegian Government’s Decision to Cut Miner’s Fee has been Criticized by Hive Blockchain Technologies

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A publication has been released by Hive Blockchain Technologies stating the company’s reaction to the Norwegian Parliament’s recent approval of a legislative bill that was supposed to prevent virtual currency miners from having access to tax relief on electricity consumption but was made accessible to other power-intensive industries.

Hive is Greatly Affected

The statement evaluates the government’s one-sided move to adjourn the subsidy without discussing with the representatives of the mining industry and talked about proposed alterations to the loan agreement related to Hive’s only asset which is situated in Norway.

The Norwegian government’s decision to withdraw subsidies on power consumption which is available to energy-intensive industries functioning in Norway has been made a target by Hive. The bill which was aimed at revoking virtual currency miners’ access to the subsidy was passed in the earlier part of December and is expected to take effect in March of this year.

Also, the exchange explained how frustrated and disappointed it is by the government’s decision to take a one-sided action without consulting, discussing or having any dialogue with the industry.

The bill was viewed by the company as a major hindrance to Norway being able to attract long-term foreign investment, and it also issued a precaution that the bill was likely to discourage all energy-intensive industries that are contemplating establishing long-term capital investments in the country.

Also, Hive has stated that it will carry out an assessment of the bill’s impact on the economics of Kolos Data Centre, it’s the only asset in Norway.

Furthermore, Hive issued a letter in December 2018 to debt holders related to the Kolos acquisition wherein it suggested some alterations to the loan agreement associated with the asset.

Presently, the company is asking for a year extension of the term of the loan of approximately $2.4 million which financed the Asset’s acquisition while the company predicts how the legislative alterations will affect the value and future plans for the Kolos Data Centre. The damage assessment is expected to have been completed before the end of the fiscal year on the 31th of March 2019.

Criticism from the Parliament

In addition, a representative of the Norwegian Parliamentary, Lars Haltbrekken in November 2018 has criticised the subsidies available to virtual currency miners. He said that Norway cannot continue to provide tax incentives for the most unclean form of cryptographic output— bitcoin.

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