Crypto mining has become popular nowadays as the hype of this activity and the incentives that it offers draw more attention to crypto users who want to make money out of it. Recently, Iran decided to temporarily ban crypto mining on account of extensive electrical failures happening in every part of the country. Crypto mining will be suspended for four months and every crypto operation, including registered ones, should break off as President Hassan Rouhani announced on Wednesday, May 26, 2021.
Authorized crypto mining operations in the country use up about 300 MW of electrical energy, plus the unlicensed miners consume as much as 2,000 MW and it may be the source of power failure across the country that leads to forbidding of the said activity. The authorities are prioritizing electricity supply to residential districts and hospitals since Iran’s hydropower generation stopped working due to a lack of rainfall this year.
Iran handles around 4.5% of total bitcoin mining, gaining millions of dollars in crypto funds that can be utilized to buy imports and evade sanctions. Crypto mining is profitable but complicated. Aside from Iran, this activity is prohibited in many countries as many disadvantages occurred in this process just like what Iran experienced. Also, Tesla’s boss Elon Musk stopped accepting Bitcoin for environmental concerns which in turn posed a challenge to Iran’s crypto mining activities.
Many countries are now banning and cracking down on mining operations for different reasons; such as China’s crackdown on the use of cryptocurrency for every service to back its digital yuan and its ban on crypto mining. The Crypto community will continue to observe the effect on the BTC’s price in the next four months.