Breaking! Iran To Cut Electricity to Crypto Miners From June 2022

SNEAK PEEK

  • The electricity of authorized cryptocurrency mining units will be cut off from June 22.
  • The Iranian government also banned cryptocurrency mining from saving the country’s power supply last year.
  • The Iranian government also banned cryptocurrency mining from saving the country’s power supply last year.

Iran’s Ministry of Energy has decided to cut down the electricity supply provided to the authorized crypto mines units of the country. The decision is supposed to be implemented on Wednesday, June 22, to ease the strain on Iran’s power supply.

Electricity to all 118 government-authorized mining operators in Iran will be cut off, as per Mostafa Rajabi Mashhadi, spokesman for Iran’s power industry.

Last week, the country’s electricity consumption was recorded at 62,500 megawatts (MW) during peak consumption, which is a notable figure. As per the forecasts, the consumption requirement this [Iranian calendar] week (which ends on Friday) will exceed 63,000 MW, which means a limited electricity supply.

Iran officially recognized the crypto mining industry in 2019 and started issuing licenses to miners required to pay higher electricity rates and sell their mined bitcoins to Iran’s central bank. However, the country has continuously stopped operations of crypto mining centers. To reduce pressure on the infrastructure, the government ordered two shutdowns in 2021.

Before the bans, crypto mining used to bloom in Iran. According to blockchain analytics firm Elliptic’s estimation, in May 2021, 4.5% of all Bitcoin mining took place in the country. In January, the ratio declined to 0.12%, according to the Cambridge Centre for Alternative Finance (CCAF).

Again according to the CCAF, China accounted for 30% of the global crypto hash rate in September. The ratio was about 40% in January, second only to that of the United States.

The sudden drop and revival in China’s hash rate suggest that its miners may have been operating covertly right after the ban by redirecting their data through proxy services. They may have become less reluctant to hide their location with time and regulations.