The crypto industry in Iceland is advancing, but it has not yet reached its full potential, as several unique geographical advantages have not been utilized.
Guli Gislason, Chief Investment Officer at Viska Digital Assets, highlighted the impact of the 2008 banking crisis, which led to capital controls on the Icelandic krona, raising awareness of cryptocurrencies and blockchain technology.
In 2014, Icelandic interest in cryptocurrencies grew even more when “Baldur Friggjar Óðinsson” released an airdrop of Auroracoin to 330,000 people from the national database, allowing many of them to convert their tokens into Bitcoin.
Despite this development, Gislason believes that Iceland lags behind in crypto adoption and education. He noted that while Viska Digital has been managing crypto funds for two years, the improvement and recognition of cryptocurrencies as asset classes in Iceland are still in their early stages compared to neighboring countries.
Iceland excels in renewable energy sources, with over 99.98% of the country’s electricity being generated from renewable sources, making it ideal for Bitcoin mining, utilizing excess energy that would otherwise be lost.
Increased demand for electricity from electric vehicles and limited development of new power plants, however, have led to periods of energy shortage and environmental concerns, casting Bitcoin miners in a negative light despite their role in utilizing excess energy.
Viska Digital Assets, whose founders are also involved in the Bitcoin mining company Greenblocks, faces challenges but sees potential. Gislason emphasized the need for more power plants and highlighted the hedge fund criteria for investments: liquidity, market interest, and proper risk management. The company avoids exposure to risky entities such as FTX and Silvergate Bank, focusing on these factors.
He is optimistic about the future, believing that the industry is at an exciting stage of the adoption curve, with major players like BlackRock beginning to engage with Bitcoin and other crypto assets.