According to the government body responsible for power generation and distribution in Iran, crypto mining activities will be permitted to operate from September 22.
On September 22, ran’s government will abolish the ban on cryptocurrency mining. According to the Iran Power Generation, Distribution, and Transmission Company (Tavanir), the demand on the power grid will subside by then, allowing miners to restart operations. The Ministry of Industries, Mining, and Trade removed the prohibition on mining on former President Hassan Rouhani’s direction. It was initially implemented to reduce energy consumption.
According to the Financial Tribune, the mining industry has been putting a burden on the country’s electricity grid. It did remark, however, that the power consumed by legitimate miners was a small part of the total. Unlicensed miners, on the other hand, apparently utilize between 2,000 and 3,000 MW per day – over half of the city of Tehran’s daily consumption.
However, the government is not wholly opposed to cryptocurrency. It established a legal framework to control the market in June 2021. This followed a directive from Rouhani, who also allowed bitcoin mining in 2019. Iran, on the whole, is taking a rather modest approach to cryptocurrency regulation. None of the legislation it has enacted has been particularly punitive. Cryptocurrency appears to have a chance of adoption there, but with limited use cases.
In limbo, the mining industry
In 2021, the mining industry has been severely harmed. Numerous governments have shifted their focus to miners as they consider a comprehensive regulatory framework. While the regulatory process is inherently difficult to accomplish, governments do have the ability to halt mining activity while they work on regulation.
Among these, China is waging the most aggressive campaign against the mining industry. The country is a hub of mining activity due to its low electricity rates. Several mining farms in several regions have been ordered to close by the government.
Suffocating the mining industry may have a brief negative impact on the market, but overall, the market continues to thrive. As more networks adopt stake consensus procedures, the issue becomes less concerning. Meanwhile, Bitcoin remains secure due to the high volume of investment from both retail and institutional investors.
The mining business is thriving, with numerous asset managers investing in associated firms. BlackRock, the world’s largest asset manager, said in a recent SEC filing that it owned $384 million worth of mining company stock. Riot Blockchain and Marathon Digital Holdings are two of these that are popular among large-capital investors.
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