Authorities in Iran plan to shut down licensed crypto mining facilities as electricity consumption in the country hits record highs. The Islamic Republic’s Ministry of Energy announced that the mines would be without power on Wednesday.
Legal crypto miners in Iran halt operations again due to power shortage
Authorized cryptocurrency mining businesses in Iran will have to unplug their power-hungry coin minting equipment from the beginning of Tir next month on the Iranian calendar, or Wednesday, June 22. Ministry of Energy spokesman Mostafa Rajabi Mashhadi announced the decision cited by the Tehran Times.
The government official noted that the measure applies to 118 licensed mines currently operating in the Islamic Republic. The temporary restrictions will be imposed after the country’s electricity consumption hit a record 62,500 megawatts (MW) during peak hours last week.
Mashhadi added that electricity demand is expected to exceed 63,000 megawatts for the week ending Friday according to the local calendar. Department of Energy representatives called the numbers significant and warned they would lead to limited power supplies across the country.
Authorities in Tehran legalized cryptocurrency mining as an industrial activity in 2019. Since then, dozens of companies have applied for licenses from the Ministry of Industry and started extracting digital currencies using low-cost energy provided by Iranian power plants.
In addition to approved mining operations, an increasing number of Iranians have been setting up mining facilities to mint digital coins using subsidized household electricity, further increasing the burden on Iran’s power generation industry. The latter has been facing serious problems due to lower-than-expected rainfall and increased demand from hot weather. A report in May revealed that Iran had dismantled nearly 7,000 illegal crypto farms.
Power shortages and frequent blackouts in the country last summer were partly blamed on increased electricity use in mining, and even licensed miners were ordered to shut down. They were allowed to resume operations in September but were again asked to suspend activities in the face of growing power shortages during the cold winter months.
Do you think electricity supply issues will continue to plague Iran’s crypto mining industry? Share your thoughts on the topic in the comments section below.
Image credits: Shutterstock, Pixabay, Wiki Commons
Disclaimer: This article is for informational purposes only. It is not a direct offer or invitation to offer, nor is it a recommendation or endorsement of any product, service or company. Bitcoin.com does not provide investment, tax, legal or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned herein.