Iran’s Bitcoin Mining Industry: Inside the World’s Fifth-Largest Operation Amid Sanctions and Energy Crisis
Iran's massive, often illegal, Bitcoin mining sector, driven by cheap energy and sanctions, strains its fragile power grid while serving as a key tool for sanctions evasion.Summary
Iran hosts the world's fifth-largest Bitcoin mining operation, accounting for 4.2% of the global hashrate, largely due to extremely cheap electricity ($0.01-$0.05 per kWh) which offers huge profit margins. This boom is fueled by the need to bypass international banking sanctions, with an estimated 22% of the population using crypto to protect savings from severe inflation.
The industry is plagued by illegality; approximately 95% of the 427,000 active mining devices operate without authorization, consuming 2,000 megawatts—15-20% of the country's energy shortage. While the government legalized mining in 2019, requiring licensed miners to sell Bitcoin to the Central Bank, high tariffs push operations underground. Authorities are cracking down, offering rewards for reporting illegal farms, though some operations linked to the Islamic Revolutionary Guard Corps (IRGC) reportedly use free electricity.
Cryptocurrency is a significant tool for sanctions evasion, with sanctioned entities receiving billions in crypto. The geopolitical tension is reflected in cyber warfare, highlighted by a major hack on Iran's largest exchange, Nobitex, by a pro-Israel group. The government balances the economic benefit of mining against the critical threat it poses to national grid stability.
(Source：Brave New Coin)