Iran’s relationship with the cryptocurrency mining sector is one of love and hate. The government is again restricting crypto mining as it tries to ease the strain on the country’s electricity supply, despite knowing the promise of cryptocurrencies as a way to evade orders. international sanctions.
Mostafa Rajabi Mashhadi, a spokesman for Iran’s power sector, said in an interview with state television in Iran, electricity to all 118 government-authorized miners in Iran will be cut off from the 22nd. /6 before the seasonal spike in electricity demand. report.
Bitcoin has long been seen and used as a way for countries to circumvent trade embargoes. Iran under far-reaching punishment by the United States effectively prohibiting it from accessing the international financial system.
In 2019, Iran officially recognized the cryptocurrency mining industry and started issuing licenses to miners, these licenses are required. pay higher electricity bill and sell their mined bitcoins to the central bank of Iran.
But the country has also repeatedly halted the operations of cryptocurrency mining centers. The government has ordered shutdown twice to ease the pressure on power infrastructure last year, in which electricity demand hit a record high.
Cryptocurrency mining boomed in Iran before the ban. Blockchain analytics company Elliptic estimates in May of last year, 4.5% of all Bitcoin mining took place in the country. That rate fell to 0.12% in January, based on Cambridge Center for Alternative Finance (CCAF).
Miners in other countries have shown defiance to regulators. Cryptocurrency hash rate, a measure of the computing power used by proof-of-work cryptocurrencies like Bitcoin, in China plummeted to zero between July and August after the country implemented the harshest crackdown on cryptocurrency mining.
But the industry seems to have revived rapidly. In September, China accounted for 30% of the crypto hash rate in the world, and in January it was close to 40%, second only to the US, according to CCAF.
The recovery indicates that underground mining may be well underway in China, where cryptocurrency trading is also banned. CCAF said in a analysis.
The sudden drop and resurgence in China’s hash rate, the CCAF said, further suggest that its miners may have been operating in secrecy shortly after the ban by rerouting their data. through proxy services, the CCAF said. As time went on and regulations were in place, they may have become less vigilant about concealing their positions.