- Telecommunications Giant Vodafone Leaves the Libra Association
- Group of Central Banks Assesses Developing Central Bank Digital Currencies
- South Korea Might Impose 20 Percent Tax on Cryptocurrency Profits
- Report: Terrorists Increasingly Use Crypto to Raise Funds Anonymously
- Canadian Securities Administrators Subject Crypto Exchanges to Securities Laws
The authorities in Iran have seized roughly 1,000 Bitcoin mining machines from two former factories, as reported by local TV reporters. The actions clearly indicate that the government is highly concerned about the increased consumption (7% in June) of electric power which is illegally used by crypto miners from buildings and factories that enjoy lower per unit cost of electricity.
Recently, a spokesperson of Iran’s Ministry of Energy, Mostafa Rajabi Mashhadi said that the country’s power grid has become unstable as a result of increased mining of cryptocurrencies. He told the Islamic Republic of Iran Broadcasting (IRIB) News that Iran has witnessed a significant increase of 7% in monthly electricity consumption compared to the same time period of the previous year. As a result, the government may propose a new bill according to which cryptocurrency miners will have to pay an extra amount per unit of electricity they use. Until then the government will shut down all crypto mining activities involving illegal use of electric power.
“Two of these bitcoin farms have been identified, with a consumption of one megawatt,” Arash Navab, an electricity official, told state television.
It was also found that Bitcoin is gaining huge popularity and a warm welcome in Iran as a potential means of storing wealth and ideal investment vehicle. In addition to that Iran’s central bank has also banned digital currencies and warned banks dealing with them.
Bitcoin Mining Surges in Iran
Bitcoin and other popular cryptocurrencies require mining machines, specialized computers with greater computing power which consequently require higher energy consumption. These machines not only connect to the cryptocurrency’s blockchain network but also provide computing power for validating transactions on that blockchain which ultimately earn them reward in the form of newly generated cryptocurrency.
Nowadays, mining has become a potentially lucrative exercise – especially when done on a large scale. Bitcoin mining in Iran has recently skyrocketed and various location in the country has been found where such illegal Bitcoin mining operations are in process.
“Everyone’s talking about Bitcoin and how to get it,” said Mahsa Alimardani, a researcher at the Oxford Internet Institute, who grew up in Iran. “With US sanctions over its nuclear programme hitting Iran financially, Iranians often discuss via social media the question of how wealth can be stored securely,” she added. Gold and US dollars are long-standing popular suggestions to store their wealth.
“Bitcoin and other cryptocurrencies are slowly coming up as the third alternative,” she told the BBC.