Iran decided to temporarily disconnect crypto mining operations due to the high demand for electricity due to the weather conditions. The energy industry will suspend the electricity supply to legal crypto mining centers before the seasonal increase in the energy demand.

One of the countries that explored the mining of crypto assets the most was precisely Iran. However, they recently announced that they would cut off electricity to cryptocurrency miners.

The government of the Mid-Western nation decided to temporarily disconnect crypto mining operations due to the high electricity demand.

Anyway, one of the primary reasons the Iranian authorities gave for taking that measure was the weather conditions. They argued that the country has a terrible drought, which has worsened with the high temperatures in the territory.

In 2020, the Iranian Ministry of Commerce granted licenses to 1,000 cryptocurrency miners as Iran intended to become a world mining hub. In addition, in 2021, the official introduced a bill to regulate cryptocurrency mining in the country.

Iran uses crypto mining to reduce the impact of the restrictions imposed by the West. It is relevant to remember that the territory is under extensive US sanctions preventing them from accessing the international financial system.

Iran to Suspend the Power Service to Licensed Crypto Miners

The Ministry of Energy of the Islamic Republic of Iran recently announced the disconnection of crypto mining farms from the electricity grid.

As a result, legal crypto mining companies will stop their operations due to electricity shortages. For that reason, they must unplug their equipment temporarily.

Mostafa Rajabi Mashhadi, a spokesman for the energy industry, talked about that situation in an interview with the Iranian state television. He said they would suspend the electricity supply to 118 legal crypto mining centers in Iran. He explained that this would happen before the seasonal increase in the energy demand.

He warned that the country should prepare for energy shortages since the demand might exceed 63,000 MW in the coming days.

They Had Taken that Measure on Previous Occasions

It is not the first time the Iranian authorities have taken that measure to suspend the electricity supply. They argued that the high energy demand increases during the summer months.

Over the last two years, the Iranian authorities have closed around 6,914 unregistered crypto companies.

In 2020, the Tehran Power Company began blaming cryptocurrency mining for depleting the energy supply. That has led the government to take strong measures against illegal crypto mining. For example, they seized 7,000 crypto mining devices in June l2021.

Iranian miners may expect three months of energy shortages, but Mostafa Rajabi Mashhadi did not provide details.

The suspension of the electricity service to legal Iranian miners will affect their income significantly. However, they must have anticipated that as the authorities had previously taken similar measures.

Meanwhile, Bitcoin is trading at around USD 20,308 and has accumulated a 0.6% gain over the last 24 hours. While its daily trading volume is above USD 22.54 billion, its market capitalization is around USD 387.55 billion, according to CoinGecko.

By Alexander Salazar

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