Leveraging intra-provincial regulatory differences in a post-Paris context: Cryptocurrency mining “reverse battery” strategy in Atlantic Canada

Abstract

Cheap and abundant energy is an important incentive for the proliferation of cryptocurrency mining farms. With China's crackdown on bitcoin mining, investors have moved to the United States, Scandinavian countries, and Canada. From the perspective of business, these jurisdictions provide cheap, reliable electricity within a stable institutional context. At the same time, cryptocurrency mining has the potential to generate instability, not only through material demands on the capacity of the electricity grid, but also in jeopardizing governments’ climate goals. This article examines some strategies used by the industry to seek out favorable regulatory environments and take advantage of energy sources and infrastructures, through the case of HIVE blockchain technology, a mining company in Atlantic Canada. The article explains how in contrast with negative reports of marginal employment opportunities and drains on domestic energy supplies, bitcoin miners are developing new narratives to make cryptocurrency mining investment attractive to governments and the public. We find that HIVE has leveraged intra-provincial regulatory differences to expand operations and is currently using a “reverse battery” narrative to improve regulatory and public acceptance of cryptocurrency mining.