Iranian Government Seizes Hundreds Of Illegal Crypto Mining Machines

Iranian government seizes hundreds of crypto mining rigs (TheGeekPub)

JAKARTA – The proliferation of illegal crypto mining in Iran has prompted the government to crack down on illegal crypto mining operations in the country. Iranian state-owned Tavanir managed to seize 227 crypto mining rigs last week. They found hundreds of these machines at 14 home-based illegal crypto mining sites in various parts of Iran.

According to Bitcoin.com News, mining machines were found in homes during inspections carried out by Tavanir, Ibena and the English-language business daily Financial Tribune reported. The report shows that illegal crypto mining facilities were found in the provinces of Tehran, East Azerbaijan, Isfahan, and Khuzestan.

For your information, cryptocurrency mining has become a popular additional source of income for many Iranians. The government legalized the activity in 2019. Entities wishing to operate crypto mining facilities must obtain a permit from the Ministry of Industry and more than 50 companies have done so.

While registered mining businesses are required to pay for the electricity they use at higher export rates, private consumers in Iran have access to subsidized household electricity. The cheap energy available and the rise in the price of cryptocurrencies in the past year have caused illegal mining farms to spring up all over the Islamic Republic.

Both official and underground crypto miners were largely blamed for electricity shortages this summer when unusually hot weather boosted electricity demand. In May, the authorities imposed a temporary ban on all cryptocurrency mining to reduce the power deficit. Then, in August, Tavanir announced it would lift restrictions for licensed miners on September 22 when temperatures began to drop.

Power companies confiscated all equipment from illegal miners and the prosecutor's office recently banned the release of seized hardware until Iran's parliament decides how to treat unregistered crypto farms and their operators. So far, Tavanir has controlled 221.390 mining equipment and closed 5.756 illegal mining facilities. The owners face fines for the damage caused to the national distribution network.

According to official estimates provided by Iran's electric utility, crypto farms authorized by the Ministry of Industry currently consume around 400 megawatts (MW) of electricity. At the same time, unlicensed miners are accused of burning nearly 2.000 MW every day.

Tavanir has warned of possible blackouts during the winter months as electricity demand picks up again amid continued pressure placed on the national grid by illegal mining operations.

“Increased electricity demand by unauthorized crypto miners will likely lead to blackouts this winter when gas consumption also peaks as it did in the summer,” the company said.

In addition, they also stated that the current penalties are not harsh enough to deter illegal crypto miners and called for stricter action.