So far this year, the authorities of the Asian country have seized 216,758 pieces of hardware. Iran’s electric power company could lift the ban on Bitcoin mining activity on September 22nd.
Local sources in Iran reported that Tavanir, the national electric power company, continues to shut down unauthorized Bitcoin mining farms. So far this year, the authorities have closed more than 5,300 of them, besides seizing 216,758 pieces of hardware. That happened even though Tavanir had announced that it would lift its restrictions on mining on September 22nd.
The Iranian authorities have not only confiscated mining equipment such as ASICs and GPU cards. They also seized hard drives, servers, and other hardware units used in that activity.
Although no one knows the official report by Tavanir yet, those actions suggest that Iran continues to apply restrictive policies against illegal Bitcoin mining. Iranian miners must register with the competent authorities to operate without worrying about receiving any penalties.
Authorities Suspend Mining Activities to Avoid Power Outages
The authorities explain that the main objective of the closure of those mining farms is to avoid electricity blackouts for operating illegally. Tavanir representatives said that the electricity consumption of those farms is equivalent to that of 800,000 Iranian households, about 2 million people. However, Iran’s Ministry of Industry, Mining and Trade said that it considered that figure an exaggeration.
The Ministry of Industries, Mining, and Commerce banned cryptocurrency mining in Iran in May. That situation led to some raids during June. At the end of June, the government authorized 30 mining farms to resume their operations but again prohibited the activity.
Each Suspension of the Mining Activity Generates Millions in Losses to Farms
Since 2018, miners of Bitcoin and other cryptocurrencies, especially the Chinese, have seen Iran as a destination of interest. That placed the country in fourth place in the geographical concentration of the hash rate in April 2021, before the bans in China. However, no one yet knows how the seizures of mining devices affected the country’s computing power.
Mining restrictions in Iran preceded the bans on the activity in China. For that reason, the largest migration of miners from that country occurred in other regions of Asia, such as Kazakhstan. After years of hostility towards Bitcoin mining, the latter’s government wants to promote it in its territory.
Iranian variable policies make it difficult for Bitcoin miners to consider that country suitable to operate their farms. Each unexpected suspension of the mining activity represents a considerable cost for the companies dedicated to it. If Iran shows more continuity in its policies, alongside low electricity costs, it will become an attractive territory for Bitcoin mining.
The ban on Bitcoin mining in China made many miners migrate to countries in Asia or other continents. They were looking for low costs of electric power, the support of the government, and a favorable climate. Iran had all that, but the suspension of the activity due to massive electric power failures discouraged them.
By Alexander Salazar