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The Iranian government has temporarily halted all crypto mining activities in the country until the end of summer. The move is aimed at reducing the power burden of the national grid as the country suffers from frequent power outages due to low output from hydroelectric power plants.
The announcement was made by Iran's president, Hassan Rouhani, who cited power consumption figures for both licensed and unlicensed crypto miners in the country. Power usage by unauthorized mining operations is almost seven times higher compared to the energy used by authorized miners.
“The authorized mining of cryptocurrencies does not consume much electricity and needs just around 300 megawatts,” President Hassan Rouhani said, according to the local publication Iran Front Page. “However, it is unauthorized crypto miners that consume a lot of electricity; they consume about 2,000 megawatts.”
Unfortunately, the government won’t distinguish between licensed and unlicensed crypto mining operations. The announcement said that the temporary crypto mining ban will apply to all miners.
“As of today, it will be forbidden even for authorized miners to mine cryptocurrencies until late September,” the President added.
The country’s power supply has been recently struggling to keep up with demand causing frequent power outages. The power supply shortage was blamed on the reduced power generation of Iran’s hydropower plants due to less-than-average rainfall and crypto mining activities using household electricity.
Earlier this month, the government tried to reduce crypto mining energy consumption by targeting unauthorized miners. It announced the imposition of heavy find to illegal miner found using household electricity.
On top of heavy fines, home miners will pay compensation for potential damages they might cause to the local electricity network. Iran’s Ministry of Energy spokesperson Mostafa Rajabi explained that around 87 percent of mining activities in Iran are illegal.
