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Iranian President Hassan Rouhani addressed his fellow citizens and announced a total ban on private mining in the country during the summer months
The ban on cryptocurrency mining is caused by fears that the state's energy system will not withstand the load due to high demand for electricity on hot summer days.
In recent years, Iranians have suffered power outages due to the collapse of the local power grid. Not only active illegal mining (more than 85% of private miners do not have a license), but also outdated equipment is to blame.
In the summer, the situation is the worst. Domestic electricity consumption reaches a one-year peak. It is barely enough to provide for household needs. Large-scale outages are taking place all over the country.
One such outage, which occurred in January 2021, led to the depletion of the capital and dozens of other cities, which left millions of people without power.
The lights went out in such large settlements as Tehran, Tabriz, Mashhad. Twitter was overwhelmed with messages from terrified Iranians. The authorities were quick to blame the miners for everything.
Analyzing the situation, we can say that the Iranian authorities themselves are to blame. A couple of years ago, cryptocurrency began to seem to the Government an excellent way out of the crisis after the imposition of U.S. sanctions.
Cheap energy, the price of which is 3.25 times lower than in the United States (4/13 cents per kWh, respectively), has made Iran a major mining center. The country is in the top 10 crypto capacity, consuming 450 MW in mining every day.
The energy system is in a deplorable condition and cannot withstand such a load. Therefore, the authorities went down the path of least resistance and simply banned mining.
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