Crypto mining rigs seized in Iran this year

Iran has confiscated more than 9,400 crypto mining rigs in the past five months, all while the country has struggled with blackouts over the summer.

The mining rigs were discovered scattered throughout the capital, Kambiz Nazerian, head of the Tehran Electricity Distribution Company, said on Monday and was reported by Iran International.

Most of that number stems from a major move in June, when Iranian police discovered an illegal mining farm and seized 7,000 units, marking the country’s largest confiscation of illegal machinery to date.

Despite being an oil-rich nation, the country has continuously suffered from rolling blackouts and water shortages due to heat waves, leading to protests in several cities.

The government often pointed to crypto mining as a major reason for growing demand.

While reports do not specify whether all the rigs seized were Bitcoin-specific, Iran contributed as much as 7.5% of bitcoin’s hashrate (the total computing power on the network) last March, according to the Cambridge Bitcoin Electricity Consumption Index. Iran’s hash rate has since dropped to 0.2%, as of January.

As part of efforts to combat increased demand for electricity, Iran banned all crypto mining operations in May for a period of four months. The embargo is expected to be lifted in September.

Iran later cut power to 118 licensed crypto mining farms in June over fears that there would not be enough power to meet peak demand during the country’s warmer months.

The government also imposed restrictions on crypto mining activity last winter and summer. And while licensed miners have had to follow the rules, illegal mining has persisted.

They are often found hiding inside mosques, schools and local businesses to take advantage of subsidized or free power and to hide their true nature, according to reports.

In January 2021, authorities in Iran seized 45,000 application-specific integrated circuit machines, which were found to be using illegally subsidized electricity from state energy supplier Tavanir.

Earlier that month, Iranian authorities shut down 1,620 illegal cryptocurrency mining operations said to have used a combined 250 megawatts of electricity over an 18-month period.

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