Government-linked crypto mining is intensifying an energy crisis in Iran, according to residents. They blame these operations for worsening power outages and drying up lakes in recent months, Cryptopolitan reported in August.

What's happening?

Iran is facing one of its worst droughts in history, and it has depleted energy and water resources throughout the country. Hot summer months pushed the country to its limits — and Iranians have placed responsibility on cryptocurrency mining for exacerbating the problems.

Residents are experiencing lengthy blackouts and severe water shortages that have ignited small but vocal protests in several communities, as The Observer also reported. 

According to that news outlet, Lake Urmia, which was once one of the world's largest saltwater lakes, has been reduced to a salty marsh that is on the verge of drying up. 

Experts have pointed to cryptocurrency mining operations as a major aggravator of this disaster. 

An Iranian engineer cited by The Observer alleged that cryptocurrency mining by the state is consuming up to 5% of electricity, contributing to water and power depletion. 

"We are in a serious and unimaginable crisis," Iran President Masoud Pezeshkian said as he urged action during a recent cabinet meeting.

Why is cryptocurrency mining important?

Historically, cryptocurrency mining has been criticized for its energy-intensive process, which strains fragile power and water systems. 

Traditional crypto mining requires large amounts of electricity to run powerful computer networks. In Iran, the portion of the country's electricity demand going to state crypto mining could otherwise be used for priorities during energy crises.

Globally, crypto mining's heavy energy footprint has raised environmental concerns. However, supporters note that digital currencies can also drive innovation and, when powered by renewables, help finance clean energy projects.

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What's being done about cryptocurrency mining?

Some cryptocurrency networks are experimenting with cleaner technologies such as proof of stake systems and clean mining operations, which could significantly cut energy use. Environmental advocates are urging stricter limits on industrial cryptocurrency mining and advocating for more sustainable water and energy policies.

As for Iran, authorities have been rationing electricity and temporarily closing government offices to conserve energy.

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