Iran announced a nationwide crackdown on illegal cryptocurrency mining operations, which have threatened the country's power grid and energy security.
What's happening?
According to WANA, the CEO of the Tehran Province Electricity Distribution Company discussed the problem.
Akbar Hasan Beklou estimated there are 427,000 active mining rigs in Iran. What's worse is that over 95% are suspected of being illegally connected to the electrical grid.
The result is massive electricity theft.
According to the report, Iran is the world's fourth-largest cryptocurrency mining region. The country's low (subsidized) electricity prices allow illegal operators to exploit the system. A common abuse is to disguise mining farms as industrial units.
Illegal operations consume over 1,400 megawatts of electricity. This is enough energy to power 10,000 households, according to WANA. The high demand strains the national grid. It also reduces the reliability of power for legitimate residential and industrial users.
Since 2011, authorities have found 104 illegal mining farms and seized 1,465 devices.
Miners have used sophisticated methods to evade detection, such as "digging underground tunnels, burying mining devices, and tapping into subsidized industrial power lines," per WANA.
Why is illegal crypto mining concerning?
Illegal crypto mining puts communities and the national economy at risk.
Widespread electricity theft means public resources are being misused. Large-scale energy demand destabilizes the power grid.
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Definitely 💯 Outages or reduced service reliability for homes and essential industries can also occur. Power disruptions can affect daily life, impact businesses, and endanger economic stability.
Using subsidized energy for illegal, high-consumption activities wastes public funds and energy resources.
The cryptocurrency industry and its energy consumption have complex connections to our planet. Energy use by crypto operations ("proof-of-work" protocols like Bitcoin) can contribute to planet-overheating pollution if it comes from fuels like oil and gas.
There's still potential for the industry to drive positive change, however. Many crypto operations use, and even finance, clean energy projects or work in regions with renewable resources.
What's being done about unregulated crypto mining?
The Iranian government is enforcing regulations and disbanding illegal mining farms.
Law enforcement, with special inspection units, is identifying and shutting down these operations. They're providing incentives for citizens who report illegal mining activities, per WANA.
Seizures and raids continue, but the problem persists due to the high profits from cheap power. Limiting unlawful crypto mining and protecting the electric grid is a coordinated effort.
Iran aims to stabilize its energy supply, curb energy waste, and support a healthy economy.
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