According to local media, Iranian authorities shut down around 7,000 illegal cryptocurrency mining facilities in two years. The report said that the majority of illegal Bitcoin farms were located in Tehran and five other Islamic Republic provinces.
Iran Crackdowns Unlicensed Cryptocurrency Mining
Iranian officials unplugged 6914 of the crypto farms without mining licenses and have disbanded them all. Since 2020 when authorities began to crack down on illegal mining of cryptocurrency, this was revealed by the English-language Iranian newspaper Financial Tribune.
According to Iribnews.ir’s report, these facilities used 645 megawatts in electrical power and created digital currency without authorization. It has been estimated this equals the annual consumption of three major regions — North Khorasan, South Khorasan, and Chaharmahal-Bakhtiari.
Since July 2019, cryptocurrency mining is a legal industry activity in Iran. The Ministry of Industries established a licensing system. Companies that wish to participate in the industry must get authorization.
However, registered crypto miners must purchase electricity at export rates higher than their local rate. Many Iranian miners chose to keep under the radar. These illegally connected to the grid, and used subsidized electricity for their mining equipment.
Iran’s Power Generation, Distribution, and Transmission Company (Tavanir) has been going after underground crypto farms, closing them down and confiscating hundreds of thousands of mining machines. They can be prosecuted for any damages they cause to the distribution network. Last month, a government report stated that it is planning on increasing the penalties.
The country’s electricity shortages last summer were partially blamed on increased electricity usage for coin minting and even licensed miners were asked to shut down their equipment. After being allowed to resume their operations in September, the miners were again asked to cease all activities due to the increasing power shortage in colder months.
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