Cryptonews Altcoin News Bitcoin Mining Activity Sees Huge Surge in UAE – Here’s the Latest

Bitcoin Mining Activity Sees Huge Surge in UAE – Here’s the Latest

Lloyd Rick

Last updated: October 23, 2023 05:59 EDT | 2 min read

Bitcoin mining companies have been looking for a suitable region to call home ever since they were forced to leave China.

Many of them are now eyeing the United Arab Emirates as a potential location to set up shop in, as the country started emerging as the crypto mining hub in the Middle East.

Some major mining companies have already signed agreements and entered partnerships with the digital asset arm of a sovereign wealth fund from Abu Dhabi.

The fund, known as Zero Two, partnered with a native Bitcoin mining company Phoenix Technology in 2021. The move started a Bitcoin mining revolution in the region.

While mining companies were slow to approach, they are developing a strong interest in operating in the area.

The momentum kickstarted by Zero Two and Phoenix Technology’s partnership was continued earlier in 2023, when the fund entered its second partnership.

This time, it teamed up with a US mining company, Marathon Digital.

The UAE emerged on the global #bitcoin mining map in early 2023 when @MarathonDH announced a JV with Zero Two, the digital asset arm of Abu Dhabi's sovereign wealth fund.

Per this JV, they will develop and operate two sites totaling 250 MW in Abu Dhabi. pic.twitter.com/B1mOl2IhDn
— Jaran Mellerud 🟧⛏️ (@JMellerud) July 5, 2023

As of early July 2023, the UAE’s operational Bitcoin mining capacity is approximately 4% of Bitcoin’s global hashrate.

This translates to around 400 megawatts, according to Bitcoin mining expert Jaran Mellerud.

The United Arab Emirates is emerging as the prime destination for #bitcoin miners in the Middle East 🇦🇪

Read this thread to learn more – and don't forget to read the entire article at the end. pic.twitter.com/393gh6HcA5
— Jaran Mellerud 🟧⛏️ (@JMellerud) July 5, 2023

He noted that at an assumed average energy efficiency of 30 J/TH, BTC miners in the UAE should generate approximately 13 EH/s. This represents 4% of the total Bitcoin hashrate.

Split between the mentioned semi-governmental projects and countless small-scale amateur deployments, the UAE’s operational bitcoin mining capacity is likely around 400 MW – or 4% of #Bitcoin's global hashrate.
— Jaran Mellerud 🟧⛏️ (@JMellerud) July 5, 2023

UAE has an abundance of energy useful to the miners

Apart from being crypto-friendly, unlike China, the UAE can also offer abundant energy resources.

All of the country’s electricity is generated by natural gas, but the nation is making a shift toward nuclear and solar power.

The UAE just opened the largest nuclear power plant in the region, with a total capacity of 4 gigawatts.

Furthermore, it is set to expand this year, so the influx of nuclear energy will boost the demand for flexibility.

The country is also perfectly positioned to benefit from solar power. The region features massive solar fields that produce large amounts of additional energy, periodically.

A lot of their energy is wasted via the desalination plants. This wasted power can be put to a better purpose by directing it toward Bitcoin mining companies.

The UAE will become the major mining nation over the next few years

The researcher concluded that Bitcoin miners could have a future in the UAE.

With that in mind, it is likely that they will continue to approach the country and enter into new partnerships and collaborations with the fund, and the local authorities.

Mellerud believes the UAE will become a major Bitcoin mining nation in several years. More than that, it could be an example for neighboring countries.

At the moment, mining profitability remains low, despite seeing an increase recently.

At this time, miners earn $0.077 per terahash per second (TH/s) each day. At its peak, it was at $0.40 TH/s/day in 2021, when the industry was at the height of the bull market.