Iran bans Bitcoin mining due to power outages in cities

Dubai, United Arab Emirates – Iranian government announces ban on mining Bitcoin The country’s President Hassan Rouhani announced on Wednesday that officials blamed energy-intensive processes for power outages in some Iranian cities.

Rouhani told national television that the ban will take effect immediately and will last until September 22. This is the latest sign of a high-profile rejection of popular digital currencies.

In the past few months, Iran’s capital Tehran and several other large cities have faced multiple power outages every day. Officials blamed natural gas shortages, prolonged droughts that hindered the country’s hydroelectric power plants – and more Bitcoin mining.

Government officials stated that most of the energy consumption generated by Bitcoin mining comes from illegal miners or unlicensed operators.

Due to the surge in electricity demand, this has prompted a nationwide crackdown on illegal Bitcoin miners and temporary power outages in legal Bitcoin farms, thanks to increased consumption coronavirus Home order. As the country’s temperature rises, electricity consumption has been so high in recent weeks that some medical facilities have difficulty running their cold storage facilities for the Covid-19 vaccine.

In January, Iranian police confiscated nearly 50,000 Bitcoin mining machines Illegal use of subsidized electricity. According to Iran’s state-owned power company Tavanir, these miners consume 95 megawatts of electricity per hour at a cheap state subsidy rate.

The Iranian government stated that 85% of Bitcoin mining in the country is carried out illegally. Tanaville said on Wednesday that the country of 82 million people has 50 licensed mines, using a total of 209 megawatts of electricity.

This cryptocurrency hit an all-time high of more than $63,000 per coin in April, but has recently come under fire for the energy-intensive nature of its production and its attendant environmental costs.

Bitcoin miners use dedicated computers to solve complex mathematical equations, thereby effectively enabling Bitcoin transactions to pass. Miners are rewarded for their efforts in digital currency.

However, the entire process is very energy intensive due to the power used by the computer.

Tehran allows cryptocurrency mined in Iran to pay for imported goods, which can help it bypass the Trump administration’s extensive U.S. sanctions against the country. According to Iranians living in the country, the central bank of Iran prohibits the trading of cryptocurrencies mined abroad, even though these cryptocurrencies can be found on the black market.

According to data from the blockchain analysis company Elliptic, between January and April this year, about 4.5% of the world’s bitcoin mining took place in Iran. This makes it among the top 10 in the world, and China ranks first with nearly 70%.

China announced its own ban in mid-May Regarding financial and payment entities that provide services for encrypted transactions, this has caused Bitcoin and several other digital currencies to get into trouble. In April, Turkey’s central bank is banned Use cryptocurrency and crypto assets on the grounds of transaction risk.

The move by Iran and China follows Iran’s heavy decision Tesla Ceo Elon Musk to Suspend to allow purchases The company’s vehicles use Bitcoin, citing concerns about climate change. The price of the token dropped by 10%, and fell further after China imposed a ban, falling to $30,000, which subsequently made up for some losses.

After Musk stated that he had had “potentially promising talks” with North American Bitcoin miners on how to make the process more environmentally sustainable, Bitcoin rose on Monday to close to $40,000. At 2:25 pm Eastern Time on Wednesday, the digital currency was traded at approximately US$38,800, an increase of approximately 4% from the previous day.