{"id":9431,"date":"2021-01-17T08:54:24","date_gmt":"2021-01-17T08:54:24","guid":{"rendered":"https:\/\/www.radiofree.org\/?p=151045"},"modified":"2021-01-17T08:54:24","modified_gmt":"2021-01-17T08:54:24","slug":"outcry-over-power-outages-smog-forces-iran-to-act-against-bitcoin-miners","status":"publish","type":"post","link":"https:\/\/radiofree.asia\/2021\/01\/17\/outcry-over-power-outages-smog-forces-iran-to-act-against-bitcoin-miners\/","title":{"rendered":"Outcry Over Power Outages, Smog Forces Iran To Act Against Bitcoin Miners"},"content":{"rendered":"

Iranian authorities are blaming power outages and worsening air pollution in cities across the country on the energy drain caused by bitcoin mining operations.<\/p>\n

The cryptocurrency farms are a huge energy drain because they use banks of high-powered computers to try to unlock complex numerical puzzles related to international financial transactions.<\/p>\n

When successful, bitcoin miners create units of so-called digital coins that can be traded globally without the scrutiny and restrictions of traditional financial markets.<\/p>\n

Circumventing Sanctions<\/strong><\/big><\/p>\n

In August 2019, facing strangling U.S. economic sanctions, Iran eased its restrictions on cryptocurrencies in an attempt to break economic isolation by circumventing the traditional financial markets Tehran has been blocked from using.<\/p>\n

Proposed by Iran\u2019s central bank and Energy Ministry, the legislation allowed bitcoins \u201clegally\u201d mined in Iran to be used for financing imports from other countries.<\/p>\n

The law allowed a limited amount of Iran\u2019s cheap subsidized energy to be used by authorized cryptocurrency miners. Power-sucking bitcoin operations became cheaper in Iran than other countries.<\/p>\n

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\"A<\/div>\n<\/div>\n

A photo provided by the Iranian police shows boxes of machinery used in Bitcoin mining operations that were confiscated by the authorities in Nazarabad.<\/span><\/div>\n

Now, Iranian authorities admit that thousands of \u201cillegal\u201d cryptocurrency farms also have sprouted up across the country.<\/p>\n

The proliferation has been bolstered by the skyrocketing prices of bitcoin during a pandemic that has seen global investors flock to cryptocurrencies with money pulled out of stocks and commodities.<\/p>\n

Mahmud Vaezi, the head of Iranian President Hassan Rohani\u2019s office, has responded to allegations of government involvement in illegal bitcoin operations by saying there has been \u201cpressure to regulate it some way.\u201d<\/p>\n

To be sure, that pressure has increased in recent weeks as cities across Iran have been blanketed by unprecedented smog and increasingly hit by power outages — including blackouts in Tehran and large parts of major cities like Mashhad and Tabriz.<\/p>\n

Alireza Kashi, spokesman for the Mashhad Electricity Distribution Company, says those managing the power grid have had no alternative to the electricity cuts because \u201cif these intermittent outages do not occur, we will face widespread power outages.\u201d<\/a><\/p>\n

Winter Freeze<\/strong><\/big><\/p>\n

Meanwhile, winter temperatures have led to a surge of domestic gas consumption for home heating in Iran.<\/p>\n

According to the semiofficial Iranian Students\u2019 News Agency, that has caused natural-gas shortages and forced power plants to burn low-grade fuels in order to generate the electricity that keeps the bitcoin mines and the rest of the economy running.<\/p>\n

Combined with increased automobile traffic due to the closure of mass transit systems aimed at slowing the spread of the coronavirus, residents of Iranian cities are now subjected to a visible rise in air pollution.<\/p>\n

Health officials warn the increased pollutants are causing respiratory illnesses that complicate the symptoms of those fighting COVID-19 and increase the death rate.<\/p>\n

In fact, Iranian officials first announced the country’s power grid was struggling from a cryptocurrency surge during the summer of 2019 — before Tehran lifted its restrictions on bitcoin farming and transactions.<\/p>\n

In June 2019, Energy Ministry spokesman Mostafa Rajabi announced an \u201cunusual\u201d spike in electricity consumption from illicit bitcoin operations that were making the power grid \u201cunstable\u201d and causing problems for consumers.<\/p>\n

State-controlled television that summer reported a crackdown on two cryptocurrency mines in the central Yazd Province.<\/p>\n

Located in abandoned factories, authorities said they were each operating more than 1,000 bitcoin machines.<\/p>\n

Iran\u2019s deputy energy minister warned that same month that the number of cryptocurrency operations was increasing, with some being based in “schools and mosques” that receive electricity for free.<\/p>\n

Now, faced with a growing public outcry over the smog and power outages, Iranian officials are being forced to expand their crackdowns.<\/p>\n

On January 12, Energy Minister Reza Ardakanian said Chinese bitcoin mines would be allowed to continue as long as they extracted cryptocurrencies in accordance with a legal license.<\/p>\n

A video then went viral on social media showing thousands of bitcoin machines being operated as part of a licensed Iranian-Chinese cryptocurrency farm in the southeastern city of Rafsanjan.<\/p>\n

Iranian state media reported that the bitcoin mining farm had been using 175 megawatt-hours (MWh) of electricity — nearly one-third of the total amount of electricity allotted for all cryptocurrency operations in the country.<\/p>\n

On January 14, Iran\u2019s state-owned Tanavir electricity firm announced the temporary closure of the Iranian-Chinese bitcoin operation.<\/p>\n

Rajab Mashhadi, a spokesman for Iran\u2019s electricity industry union, said on January 14 that a total of 1,620 illegal cryptocurrency firms that consumed around 250 MWh of electricity also have been deactivated.<\/p>\n

But with many more \u201cunauthorized\u201d bitcoin extraction centers continuing to operate across the country, as well as operations authorized by the Energy Ministry, it\u2019s unclear how much longer residents of Iranian cities will have to endure the smog and cryptocurrency power outages.<\/p>\n\n

This post was originally published on Radio Free<\/a>. <\/p>","protected":false},"excerpt":{"rendered":"

Iranian authorities are blaming power outages and worsening air pollution in cities across the country on the energy drain caused by bitcoin mining operations. The cryptocurrency farms are\u2026<\/p>\n","protected":false},"author":4,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[107,25,4,23],"tags":[],"_links":{"self":[{"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/posts\/9431"}],"collection":[{"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/comments?post=9431"}],"version-history":[{"count":1,"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/posts\/9431\/revisions"}],"predecessor-version":[{"id":9432,"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/posts\/9431\/revisions\/9432"}],"wp:attachment":[{"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/media?parent=9431"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/categories?post=9431"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/tags?post=9431"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}