Iranian President Hassan Rouhani has announced a ban on bitcoin and other cryptocurrencies mining across the country with immediate effect. About 85% of current mining in Iran is unlicensed.
The ban will last until September 22nd of this year. This decision comes at a time when the country is suffering from many and long power outages.
A few days ago, the ban on cryptocurrency mining using domestic electricity had preceded, but due to this, it was eventually extended in every direction.
The problems with electricity in many parts of the country are not only attributed to the consumption of cryptocurrency mining facilities, but also to the drought and the growing demand for electricity due to the summer.
It is estimated that 4.5% of bitcoin mining takes place in Iran. The company said mining revenues allow “the country to bypass trade embargoes and earn hundreds of millions of dollars in cryptocurrencies that can be used to buy imported goods and circumvent sanctions.”
Iran requires licensed miners to sell their bitcoins to the central bank directly. Cryptocurrencies legally mined in the country can be used to pay for imports of approved goods. In April, Iran authorised banks and stock exchanges to use cryptocurrencies as a means of payment for imports.
Government officials claim that the majority of bitcoin mining energy consumption comes from illegal mining facilities operating without the required permits. In January, the Iranian police seized 45.000 bitcoin mining machines using illegally subsidised electricity.
The president of Iran also said that the energy minister was right to apologise to the Iranian residents for the blackouts that were unplanned, which affected businesses and households in a few cities last week.