Iran Outlaws Bitcoin Mining Amid Power Shortage Crisis

Iran Outlaws Bitcoin Mining Amid Power Shortage Crisis

Iran has experienced recent issues with rolling blackouts and power shortages that have been blamed on new bitcoin mining farms in the region. 

After suffering through numerous power outages in Tehran and several other large cities, the Iranian government has placed the blame on Bitcoin miners. Specifically, new operations that have sprung up in the wake of China’s sweeping bans on crypto-mining claims a new report by CNBC. Many of these mines are also operating illegally without a license, according to government officials. 

The belief among officials in Iran is that a majority of the energy needed to power cities is being used by illegal miners. Officials didn’t place the blame solely on the shoulders of miners, however, and added that natural gas shortages and drought have had a negative impact on Iran’s hydropower capabilities. 

President Hassan Rouhani made the announcement that effective immediately, a ban on cryptocurrency mining would be in effect. The ban would be in place until September 22, Rouhani told state TV. 

Iran’s fight against illegal crypto-mining

The issues Iran has with cryptocurrency extend past power consumption, but have often seen miners involved. In January, Iranian police discovered an illegal mining operation that was using around 50,000 rigs to mine bitcoin. The miners were reportedly churning out 95 megawatts per hour of power. Making matters worse, the power was being supplied at a state-subsidized rate, as reported by Tavanir. Later, in June, the Iranian police reportedly seized more than 7,000 mining machines in a raid of a factory in Tehran. 

Between the power outages and the number of illegal operations afoot, Iran has really started cracking down on mining in general. After China’s ban on crypto Iran became a popular alternative due to its cheap power and willingness to offer it to miners. Back in 2020, Iranian power suppliers were happy to sell dirt cheap power to miners. Now, reports state that up to 5% of all bitcoin mining is done in Iran. The Government, at that time, even pushed to legalize the industry. But, after the power outages became more of an issue, fines and bans were not far behind. Government spies were even utilized in order to sniff out the illegal operations in Iran.

The government added that it believes 85% of the mining within its borders is done so illegally and makes it difficult for the 50 licensed operations to function.


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