FameEX Hot Topics | Bitcoin Extraction: Middle East Desert Prepares to Accommodate Immersion Cooled Crypto Mining Farms at Large Scale

The United Arab Emirates (UAE) is embarking on an innovative project to establish two large-scale cryptocurrency mining facilities. Overcoming the challenges posed by the desert climate, these data centers will adopt full immersion cooling technology instead of traditional air-cooled methods. Marathon Digital Holdings, a renowned American crypto mining company, and emerging blockchain infrastructure developer Zero Two are collaborating to pioneer the Middle East's first immersion-based Bitcoin mining operations.

To facilitate this venture, the partners have formed a joint venture named Abu Dhabi Global Markets (ADGM). This initiative involves the development and operation of two digital asset mining sites with a combined capacity of 250 megawatts (MW), according to Marathon's press release. The larger facility, capable of generating 200 MW, will be constructed in Abu Dhabi's environmentally sustainable hub called Masdar City. The second site, with a capacity of 50 MW, will be situated in the port zone of Mina Zayed.

The mining farms will utilize surplus energy to contribute to the stability and sustainability of Abu Dhabi's power grid. Moreover, both companies have committed to offsetting any non-sustainable electricity consumption through the use of clean energy certificates. Construction is already in progress, and the necessary mining equipment has been ordered. The facilities, expected to have a combined hash rate of approximately 7 EH/s, are projected to commence operations as early as this year.

Prior to this ambitious project, Marathon Digital and Zero Two conducted a pilot program to assess the feasibility of large-scale crypto mining in Abu Dhabi's hot desert climate. Encouraging results revealed that immersion cooling solutions, along with custom-built ASIC miners and proprietary software for optimization, have made mining operations viable. In terms of equity ownership, Zero Two will hold an 80% stake in the ADGM joint venture, while Marathon will retain a 20% stake. Capital contributions for 2023 are estimated to reach around $406 million.

These details emerge at a time when industry analysts foresee a potential migration of crypto miners to more favorable jurisdictions due to mounting regulatory pressures, escalating energy costs, and increased taxation in current mining hotspots. The establishment of advanced mining facilities in the UAE reflects the region's aspirations to become a prominent player in the cryptocurrency mining sector.

Disclaimer: The information provided in this section is for informational purposes only, doesn't represent any investment advice or FameEX's official view.