TL;DR Breakdown
- Iranian government lifts ban on crypto mining.
- Iran houses seven percent of global crypto mining super computers.
- Illegal Bitcoin mining led to shortage of power in Iran leading to moratorium.
The Iranian government, after three months, has lifted the temporary ban on cryptocurrency mining in the country by ex-Presiden Hassan Rouhani.
The ex-president ordered the moratorium after crypto miners in Iran were partially blamed for blackouts that took place in Tehran and other Iranian cities.
This is as Iran houses about seven percent of world cryptocurrency mining by powerful computers, which consumes a lot of electricity.
Before the ban was lifted, The Iranian government announced last month that the restrictions on Bitcoin mining would be lifted. According to the Iran Power Generation, Distribution, and Transmission Company (Tavanir), miners in the country will reboot their rigs starting on September 22.
Now that the government has lifted the ban, Bitcoin miners will be able to resume their operations after the electricity preservation policy.
Why Iranian government placed a ban on crypto mining
Back in May, Hassan Rouhani-led government banned Bitcoin (BTC) and crypto mining operations. He made the decision, reportedly to prevent miners from overburdening the electricity grid in the country.
Miners were said to have caused the constant blackout and power shortage experienced in Iran. It led Iran to also stopping electricity export to neighboring Afghanistan.
The moratorium was necessary as 85 percent of all cryptocurrency mining operations in Iran are reportedly set up illegally.
However, now that the ban has been lifted, only authorized miners will be cleared to resume operations. This is because illegal crypto mining operations are reportedly going to set the country back with power shortages and regular blackouts.
Iran remains one of the crypto-friendly countries around and has been legalizing Bitcoin mining since 2020, with over 1,000 licenses issued in January 2020. The Iranian government appears keen on localizing its crypto mining sector, with parliament even considering a bill to ban the use of “foreign-mined” cryptocurrencies for payments in the country.