Iran to impose heavy fines on crypto miners found using household electricity

The Iranian government has been closely monitoring crypto mining activities in the country amidst ongoing energy supply shortages. It announced that it will impose heavy fines on miners found to be using household electricity, a move aimed at curbing unauthorized mining activities.

Iran’s Ministry of Energy spokesperson Mostafa Rajabi said that, since crypto mining using household electricity is not legal, those discovered will have to pay heavy fines, according to The Tehran Times. In addition, home miners will also have to compensate for potential damages their activities might have caused to the electricity network.

The measures are in place to address the country’s power shortage. The energy situation is blamed on the reduced power generated by hydropower plants due to less-than-average rainfall and crypto mining activities using household electricity.

Unauthorized mining could lead to power supply issues due to the damage they could cause to the local grid and transformers that could eventually lead to blackouts. Rajabi estimates that as much as 87 percent of mining activities in Iran are illegal, according to Cointelegraph.

In 2019, the Iranian government approved crypto mining as an industrial activity, which started the boom in the mining industry as companies started to put up mining operations across the country due to its cheap power rates. However, the government started to strictly monitor mining, which is an energy-intensive operation, due to the ongoing energy crisis in the country.

Some power firms proposed to make their excess power available exclusively for crypto miners. The government agreed but noted that under such a scheme, these power plants will no longer be able to get subsidies on their fuel supplies.

“Constant price hikes and the obligation for supplying electricity with stable prices to subscribers have caused a large gap between revenues and expenditures in the country's electricity industry, and we need new sources of income to fill this gap,” explained Mohsen Tarztalab, the head of Iran’s Thermal Power Plant Holding Company (TPPH).

“According to the laws and regulations announced by the cabinet and the Energy Ministry, we have been allowed to allocate some capacity of our power plants for mining cryptocurrencies,” he added.

TokenPost | [email protected]