Iran’s power grid is facing significant challenges as a burgeoning Bitcoin mining boom compels regulators to crack down on illegal operations, local energy officials have revealed. The rising number of unlicensed mining activities has raised alarms about the sustainability of the country’s electricity infrastructure.
According to Akbar Hasan Beklou, CEO of the Tehran Province Electricity Distribution Company, Iran has unwittingly transformed parts of itself into a “paradise for illegal miners,” driven by significantly low electricity costs and clandestine connections to the power grid.
Illegal Bitcoin Mines Multiply
With approximately 427,000 active mining devices reported across the nation, it is estimated that over 95% operate without the necessary licenses. This extensive activity is believed to consume around 1,400 megawatts of power continuously. The scale of illegal operations has prompted energy companies to ramp up efforts to detect and eliminate these unauthorized ventures.
In recent crackdowns, law enforcement in Tehran Province alone managed to shut down 104 illegal Bitcoin farms, seizing between 1,400 and 1,465 machines in the process. Cumulatively, raids over the years have uncovered hundreds of thousands of unlicensed mining devices, often hidden within industrial facilities or connected through tampered industrial meters.
Why It’s Happening
The allure of cheap electricity remains the primary motivation for these illegal operations. With prices set well below market rates, cryptocurrency mining in Iran can yield higher returns, especially when devices are running non-stop. Furthermore, the country’s sanctions and strictures on trade have led some miners to view crypto as a viable means of transferring value outside conventional banking pathways.
Reports suggest a mix of small and large groups have exploited subsidized power supplies, often using connections intended for significant industrial users to fuel their mining activities. Officials indicate a disparity in enforcement; while numerous illegal farms are being dismantled, some appear to enjoy protection, complicating the authorities’ efforts to enforce regulations uniformly.
Insider accounts reveal that certain mining operations linked to state-affiliated entities operate at a scale that largely escapes scrutiny, adding another layer of complexity to the enforcement landscape.
Illegal Bitcoin Mining: Crackdown Efforts And Public Pressure
In response to the ongoing crisis, the energy ministry and local utilities have pledged to intensify raids and implement new mechanisms to trace illicit consumption. Measures such as offering rewards for tips and scrutinizing industrial meters are being discussed. However, the scale of the issue suggests that efforts are often reactive to the murmur of blackouts rather than proactive.
Experts caution that without adjustments in pricing and regulation enforcement, miners will continuously seek ways to circumvent the law. The mobility of mining equipment allows devices to be relocated quickly, hidden in undetected warehouses, or connected to less frequently monitored meters, posing an ongoing challenge for regulators.
Featured image from Pixabay, chart from TradingView
