Iran Seizes 45,000 Bitcoin Miners for Illegally Using Subsidized Government Electricity: Report

Police in Iran have reportedly seized 45,000 bitcoin mining rigs for illegally using subsidized electricity from the state-owned power utility Tavanir, the local Tasmin News Agency reported this week.

According to Mohammad Hassan Motavalizadeh, head of Tavanir, the efficient application-specific integrated circuit (ASIC) bitcoin miners had been consuming 95 megawatts (MW) per hour of electricity at cheaper prices.

Authorized miners are charged around 4,800 rials ($0.11) per kilowatt-hour in autumn, winter and spring, says the Iranian Energy Ministry. Subsidized rates may be half as much.

Since 2019, when crypto mining became legal in Iran, the Islamic Republic has shut down 1,620 unauthorized mining farms, local media reported earlier this month. The farms consumed 250MW of electricity, it said.

Now, the Middle East country is currently facing severe power shortages due to rising winter demand, with rolling blackouts across major cities. The government decided to blame bitcoin (BTC) mining for the dire situation.

As a result, Iran’s Energy Ministry has temporarily cut the supply of 600MW of power to all authorized BTC miners in the country, redirecting the energy to household use.

Per the Tasmin News Agency report, authorities also put a halt to production at a vast mining operation in the southwest of Iran. The facility is owned by a Chinese-Iranian investment company and is reportedly using “tens of thousands” of ASIC miners to extract bitcoin.

Some cryptocurrency researchers have argued that although miners are being targeted, they were not responsible for the current blackouts. Ziya Sadr told the Washington Post that bitcoin mining accounts for a very small share of the national electricity consumption total in Iran, where demand peaks at 40,000MW in winter.