Crypto Mining Surge in Iran: 95% of Devices Are Illegal, Posing Energy Risks

• Illegal crypto mining in Iran consumes 1,400 MW daily, straining the national power grid.
• Iran is the 4th-largest crypto mining hub, fueled by heavily subsidized electricity prices.
• Authorities shut down 104 illegal mining farms, seizing 1,465 machines consuming 10,000 households’ power.

The illegal activities of crypto mining are causing a crisis in Iran, where large volumes of electricity are being used, which is threatening the stability of the national grid. The officials project that 95 percent of the mining rigs in the country, which total 427,000, are operational without authorization, straining the national power supply.

Akbar Hasan Beklou, CEO of Tehran Province Electricity Distribution Company, said that Iran has already emerged as the fourth-largest crypto mining center in the world. Electricity in the country is highly subsidized, and it has become a haven for illegal miners who are running their rigs 24/7 due to the cheap electricity. These illegal activities consume more than 1,400 megawatts of electricity per day, leading to a worsening of the energy crisis.

Illegal Crypto Mining Worsens Power Shortages in Iran

Illegal miners tend to pass off their activities as industries to exploit the subsidized electricity charges. According to Beklou, such activities are also contributing to the common power shortages and blackouts. A further increase in illegal mining activities has threatened the entire power grid of the country.

To mitigate the problem, Iranian authorities have increased efforts to close illegal mining farms. In the Province of Tehran, 104 illegal mining sites have been shut down, and 1,465 mining machines have been seized. These machines were consuming up to 10,000 households of electricity, exacerbating the precarious situation.

Also Read: Ripple’s Bold Move Toward $120 Trillion Market Sparks XRP Momentum to $3

Iran Boosts Efforts to Combat Illegal Mining with Public Reward System

The government has also identified some hotspots of the illicit mining operations in the Pakdasht, Malard, Shahre Qods, and southwestern Tehran industrial regions. In these regions, authorities have also discovered illegal operations concealed within tunnels or underground factories that use subsidized power lines to evade detection.

The Iranian government has thought of a way to engage the masses; it has implemented a cash reward system to encourage the citizens to report cases of illegal mining. The offer made by the government is a 1 million toman (about 24 dollars) reward for each and every illegal mining device reported. This initiative is to encourage the citizens to join hands with the authorities to resolve the problem of illegal mining.

Although it has been suppressed, Iran is still an influential force in the crypto world. A June report by CoinLaw concluded that Iran is now the fifth-biggest Bitcoin hashrate distributor, with 4.2% of the network hashrate. Nevertheless, the continued expansion of illegal mining is a significant threat to the power grid and energy security of Iran.

Source: CoinLaw

Also Read: 3 Key Trump Moves That Made Bitcoin(BTC) Surge to $110K