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Comment by Sir_Substance | Hacker News Reader

>And the problems with smelting dont negate the idiocy (imho) of mining.

Except that in Iceland, crypto mining could literally, and I use the word literally in the classical and correct sense, actually negate the problems of smelting. If crypto miners out-bid aluminium smelters on power prices, the smelting will leave Iceland and move closer to the source of the ore without any net loss in income to the Icelandic economy.

The economy of aluminium in Iceland /is/ the economy of selling electricity to foreigners. It generates some dock work as well, but the bauxite is here for the power prices, not the light touch of the local forklift drivers. If we can sell that electricity without shipping things, that's obviously better.

You're welcome to think that's idiocy if you like, I guess.

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I get the relationship between the smelters and the power industry in Iceland, but despite that industries problems (I am not a fan) at least there is some economic activity going on there.

With mining, essentially we are building damns and steam generators to fuel heat dispensation for the benefit of helping some speculators win bets against other speculators. This is not economic activity imo, but some fancy techno-casino. I feel I am very justified in calling it idiotic.

And lets not ignore the externalities here. Just as miners can server as price competition to the smelters, they also out-price other potential activities. Not just as buyers of electricity, but also as investment for those that are running the datacenters. As long as the mining option is on the table, these operators and investors have no incentive to find other uses for their computer farms. Just buy some ASICs and be done with it.

It can be a net loss to the Icelandic economy if the crypto bubble bursts and Iceland is left with no miners and no smelters

You're not wrong, but if you're going to put political effort into avoiding collateral damage from bursting bubbles, crypto is not the place to start.

We're currently squeezing residents out of houses to turn them into airbnb's, replacing shops that the locals actually use with dozens of identical puffin stores selling tourist tat and bulldozing sustainable local business so we can replace them with hotels.

All this to service a tourism industry that is actually too large to handle. We've got tourists pooping in fields because no one has organised toilets for them to use. The toilets aren't there because no one is paying for them because the tourism industry is getting massive tax breaks, and yet despite this, Iceland is now so expensive to stay at that people are booking in Norway, because it's actually /cheaper/ to holiday there.

But this is apparently not a bubble and all good investment, just like the banking was I guess.

Seriously, when it comes to problems in Iceland, crypto mining isn't even on the map.

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