The below article is part of a larger series on Bitcoin mining around the world compiled by the team at Arcane Research.
Bitcoin miners have an outsized presence in Georgia, considering the country’s tiny geographical size and small population. What makes this former Soviet republic so attractive to bitcoin miners?
I lived in Georgia for six months and have first-hand knowledge of its bitcoin mining industry. Using that knowledge and a range of available data, this article will answer that question and more.
How Large Is Georgia’s Bitcoin Mining Industry?
According to the most recent edition of the Cambridge Bitcoin Electricity Consumption Index (CBECI) mining map[1], Georgian miners produce 0.18% of Bitcoin's hash rate. But I believe the country's actual bitcoin mining capacity to be far higher than this estimate. Why?
CBECI[2] uses data from mining pools to estimate the geographic distribution of miners, but the sample only includes four pools that together account for 34% of Bitcoin's total hash rate. CBECI openly admits that its samples may not be sufficiently representative, but it's still the best estimate we have.
If Georgian miners are not heavy users of the pools included in CBECI's sample, their geographical share of Bitcoin's hash rate will be underestimated.
During my stay in Georgia, I befriended miners and often visited mining facilities. These miners have told me that Georgia has at least 125 megawatts (MW) of cryptocurrency mining capacity. I have identified 62 MW from industrial-scale data centers. The remaining 63 MW should then come from lots of small, amateur setups scattered around the country in homes, garages and abandoned warehouses and factories.
As of February 15, CBECI estimates[3] that the Bitcoin network draws 14 gigawatts (GW) of electricity. Based on information from Georgian miners, I estimate
