Over 3,300 Illegal Mining Sites Detected Since Last Month's Crackdown
Extreme Power Consumption at Cryptocurrency Mining Farms Massively Imported from China
[Asia Economy Reporter Hyunwoo Lee] The Iranian government announced that it has seized approximately 7,000 mining machines from an illegal cryptocurrency mining site hidden in an abandoned factory near the capital, Tehran, marking the largest scale of mining equipment confiscated so far. Since the reimposition of U.S. sanctions on Iran in 2018, Iran has attracted numerous mining operations as a means of earning foreign currency. However, following a nationwide large-scale blackout last month, the government launched a massive crackdown, reportedly uncovering more than 3,300 illegal mining sites to date.
On the 22nd (local time), according to the state-run IRIB broadcast, the Tehran Police Department raided an illegal cryptocurrency mining site operating in an abandoned factory in western Tehran and seized about 7,000 mining machines. Iranian authorities stated that this is the largest illegal mining site uncovered in Iran to date in terms of scale.
The Iranian Ministry of Energy announced that since last month, it has identified over 3,330 mining sites across the country and confiscated more than 188,000 mining machines. Mosfata Rajabi Mashhadi, spokesperson for the Ministry of Energy, stated, "These illegal mining sites caused frequent blackouts and astronomical losses." The Ministry emphasized that all individuals involved in illegal mining have been handed over to the judiciary.
According to major foreign media, after the U.S. sanctions on Iran were reinstated during the Donald Trump administration in 2018, restricting oil exports, Iran attracted major cryptocurrency mining operations such as Bitcoin mining. The Iranian government supplied electricity to these mining sites at low prices in exchange for encouraging them to sell Bitcoin to the Central Bank of Iran, using it as a means to earn foreign currency. As a result, cryptocurrency mining operations from around the world, including China, flocked to Iran, with the scale of mining within Iran reaching 4.5% of the global Bitcoin mining capacity.
However, since the 22nd of last month, frequent blackouts have occurred in major cities including Tehran. The Hassan Rouhani administration announced a complete ban on cryptocurrency mining in Iran for four months until September 22, and pledged to crack down on all illegal mining sites. Iranian authorities have identified Bitcoin mining sites as the main cause of the national power shortage.
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