The Iranian Government Shutdown 1100 Crypto Mining Farms
As Iran enters a hot summer that threatens more blackouts, authorities are putting unprecedented pressure on a rapidly growing number of cryptocurrency miners, Iranian energy company Tavanir has been backed by a whistleblower who shut down 1,100 crypto mining operations it says were run without proper licenses.
Local authorities said they had relied on the whistleblower and found he had uncovered the illegal farms after investigating their consumption patterns. Although he said that the miners used heavily subsidized electricity, the Tavanir report made it clear that no significant changes in electricity consumption had been observed.
Officials claimed the equipment used to mine cryptocurrencies was seized because operators illegally used state-subsidized electricity. Members of the crypto- and mining community have said it is not fair to charge them more for electricity than they are paid to extract cryptocurrencies.
While the cost of electricity is low, the other costs associated with mining in Iran are much higher, and highly efficient crypto mining is even more of a concern, owing to the halved reward. Iranian consumers, the cost of mining equipment to reach them, are already very high compared to the world market.
While The national cryptography law requires miners to disclose their identities and provide detailed information to the Ministry of Industry, Mines, and Trade. All including the type of hardware used and what information has been collected and used to prevent smuggling into the country. Iran recently announced plans to operate 1: 1 industrial power plants for bitcoin miners, unless they use subsidized fuel, the Financial Tribune reported. The man who supplied the information about the unauthorized miners was paid 100 million riyals (480 euros) for his cooperation.
The Miner is defined as an individual and a company, according to the website of the Ministry of Industry, Mines, and Trade, with a total of 1,000 miners.
The Iranian government approved the promotion of cryptocurrencies as industrial activity in July 2019 and has since issued more than 1,000 licenses to cryptocurrency companies. In May, Iran’s Ministry of Industry, Mining, and Trade granted a license to cryptocurrency firm iMiner to operate in the country. With more than 6,500 rigs, the illegal cryptographers face fines of up to $1 million for each piece of hardware used, as well as jail time for anyone caught without a subsidized power source, according to a report in the Financial Times. With around 6,000 dollars per rig, iMiner is one of the largest crypto miners in Iran.
