Mohammad Javad Azari Jahromi, the country’s Information and Communication Technology Minister announced the need for a regulation on Bitcoin mining activities in the country. The news was reported by a local news agency, which highlighted a surge in the country’s power consumption due to increased mining activities in recent times.
The report stated that experts have linked Iran’s rising mining operations directly to China’s recent crypto mining ban. While China’s predominant mining culture was powered by clean hydro energy, the recent blanket ban has forced miners to find legal shelter in geographically neighboring countries. One of the main reason behind cryptocurrency miners’ interest in Iran is cheaper access to energy and lack of government regulations. Moreover, China’s crypto boom was also powered by a lack of government interference, which currently stands as the biggest threat to the crypto community within China.
Picking up China’s slack, Iran seems to cater to the needs of these miners as each kilowatt of industrial energy comes at a cheap rate of 9 to 10 cents. In comparison, the same unit of energy could cost around 20 cents, in many European countries. The difference in the price of energy is due to Iran’s large gas reserves and non-existent climate regulations within the country.
Citing an upcoming energy crisis, Azari Jahromi, the Minister of Information and Communications Technology said,
“Estimates by Iran’s Energy Ministry show that 700 megawatts of the country’s power is used for mining. This violates ordinary people’s rights.”
The IT minister further claimed that mining rigs are already being smuggled into the country from China.Iranian Lawmakers Want a Crypto Bill
The sudden surge in power consumption has prompted many lawmakers to ask for a crypto bill in the parliament. Ali Akbar Karimi, a member of the Iranian parliament’s economic committee, emphasized on the need for a crypto bill in the country. As of now, the bill is intended to help the lawmakers to determine the cost of power consumption for these crypto mining operations.
Here’s an excerpt from the interview
“Unfortunately, there is no specific law to monitor activities around cryptocurrencies in the country and it is essential that the government prepares a specific bill for determining the fate of cryptocurrencies’ mining, such as bitcoin, and exchanging currencies using this digital money and submit the bill to the Parliament so that the power rate of those who are mining across the country would be determined.”
Although Central Bank Iran (CBI) had previously despised crypto-related activities, industry experts suggest that Iran’s call for crypto regulation rather than a ban is primarily to comply with U.S. trade sanctions.