Cryptocurrency mining is a billion-dollar industry that has expanded alongside the growing trend of digital currencies. As the crypto industry continues to mature, many nations are trying to seize the opportunity and embrace crypto mining.
Iran is among the nations where cryptocurrencies may be illegal but mining them is not. The nation has been trying to profit and benefit from the introduction of legal cryptocurrency mining but has had a problem against the freedom they bring financially.
Licensing Crypto mining
Less than a year after legalizing crypto mining, Iran’s Ministry of Industry, Mine and Trade, has now given more than 1,000 licenses to cryptocurrency miners in the country.
According to reports from local news outlet Financial Tribune, Amir Hossein Saeedi Naeini an official from ICT Guild Organization – an Iranian NGO representing information and communications technology (ICT) sector, the mining industry has the potential to add $8.5 billion to Iran’s economy.
Naeini further explained that before launching a mining operation in the country, entrepreneurs must apply for a license, adding that the government has issued over 1,000 permits so far, and several mining farms have already launched operations.
Naeini also noted that despite having licensed cryptocurrency mining operations in the country, the new regulations have not attracted much foreign investment. He said:
“Most potential investors have left for neighboring countries, because they offer incentives for crypto miners.”
The industry is maturing
The Iran crypto mining industry has evolved quite a lot in the past year. The nation has made various efforts to attract miners, one such was to change electricity tariffs for miners, where miners would pay an average fixed sum of $0.08 per kWh at some times of the year, $0.04 per kWh during eight cold months of the year, and $0.16 per kWh in the remaining months when power consumption increased across the nation.
According to Naeini, “High electricity tariffs plus stringent regulations” have made the crypto mining sector “less appealing for small investors.” Therefore, a limited number of authorized mining farms are currently active in Iran.
Prior to this miner-friendly license system, the Iranian government had cracked down on two mining farm operators and seized roughly 1000 bitcoin mining rigs. The action was a result of a sudden electricity spike as the demand for power had risen by 7% and crypto-mining was blamed.
As of now, Iran is slowly recovering from the recent political tension with the US due to an airstrike at Baghdad’s airport that was ordered by American President Donald Trump to kill the head of the Iranian Revolutionary Guards’ elite Quds Force, General Qasem Soleimani. The event triggered an upward rally for Bitcoin but also saw crypto miners vacate Iran.