Iran temporarily banned cryptocurrency mining to prevent blackouts

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Over the past few times, Iran has experienced power outages frequently. From the government of that Middle Eastern country, they determined that cryptocurrency mining takes a significant part in this problem.

As a result, Iran decreed a ban on this digital activity for about four months, as a measure to address the associated high energy consumption.

Iran banned cryptocurrency mining until September 22

Hassan Rouhani, the Iranian president, commented in a televised speech at a cabinet meeting of his government that "the ban on cryptocurrency mining is effective immediately until September 22 (...) about 85% of current mining in Iran is uns licensed, "relate the Reuters news agency.

Today, several locations in Iran are facing power outages because of the lack of supply capacity for service. It has been a recurring claim by citizens to the authorities and today, with a new presidential election in the spotlight, a solution to the situation was presented, as narrated in the report cited.

Through the cryptocurrency mining process, you can create units of Bitcoin, Ethereum, and many other cryptocurrencies that are governed by similar principles and dynamics. These procedures involve high-performance computers, capable of working with complex formulas while consuming a high level of electricity.

In principle, Iran saw in more than a problem, an opportunity. Considering that electricity can be generated through fossil fuels, the country's main natural wealth, the government has opened up to this technology in recent years, offering a low-cost power supply and requiring bitcoin miners to sell their coins to the central bank. The country even allows these units to be used as a currency for the payment of imports of authorized goods.

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In this way, from Tehran, they saw this route as an outlet to activate the economy of a country currently facing economic sanctions by the United States, following Donald Trump's 2015 departure from the agreement signed in the Iranian capital after World War II.

Eventually, the four-month ban opens the door to regularize this situation at the government and diplomatic level, in the face of which joe Biden and other international powers have expressed a willingness to restore the agreement.

According to figures from blockchain analytics firm Elliptic, cited in the Reuters report, about 4.5% of global bitcoin mining takes place in Iran, an activity that allows them to obtain hundreds of millions of dollars in cryptocurrencies that deflating the impact of U.S. economic sanctions. Also, according to the same report, the low associated rates have attracted miners from China to Iran, who occupy an important share of the designated universe and who also reflect that the impact of this measure will transcend beyond the borders of that West Asian country.

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