Bitcoin Mining Banned in Iran

As officials believes that the processes requiring high energy for bitcoin mining are the main reason for blackouts in a number of Iranian cities. The government announced a ban on the mining of bitcoin and other crypto currencies. The ban is in effect immediately and will stay till Sept. 22, Rouhani told state TV.

In the last few months, in the capital Tehran and other large cities experienced several daily outages. The officials blame it on a natural gas shortage, a prolonged drought that’s hobbled the country’s hydroelectricity plants and, increasingly, bitcoin mining. A majority of bitcoin mining consumption of comes from unauthorized miners, those operating without licenses, government officials say.Bitcoin Mining Banned in Iran

These conditions stirred a nationwide shut down on unauthorized bitcoin miners as well as momentary electricity cuts to authorized bitcoin farms as power demand surges, due to the increased consumption due to the stay-at-home orders, cause of the pandemic . As summers have started and temperatures hiked, power consumption has been so high that some medical facilities have struggled to run their cold-storage facilities for Covid-19 vaccines.

50,000 bitcoin machines have been seized in January by the Iranian police due to the illegal electricity. According to the Iran’s power company the miners had been consuming 95 megawatts per hour at state-funded rates. 85% of the bitcoin mining is done without a license while the country as authorized only 50 mining farms using a total of 209 megawatts of power.
A bitcoin transaction goes through complex mathematical equations solved by the purpose-built computers and the miner gets rewarded for their efforts in the digital currency. The entire process is incredibly energy intensive because of the amount of power used by the computers.

According to blockchain analytics firm Elliptic this year from January to April 4.5% of bitcoin mining took place in Iran, thus ranking Iran among the top 10 in the world, while China came in first place at nearly 70%.
Bitcoin jumped Monday, nearing $40,000 after Musk assured “potentially promising talks” with North American bitcoin miners as how to make the process more environmentally sustainable

Also Read: Bitcoin Witnesses a Sharp Decline in its Value first time since March 2020


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