Pressure from many people in Iran to make the country a mecca for cryptocurrency miners may have some unintended environmental consequences.
Thick layers of toxic smog
According report Bloomberg, Bitcoin’s (BTC) energy demand and cryptocurrency mining in Iran, coupled with heat demand in an extremely cold winter, contributed to the shortage of natural gas, forcing power plants to burn “low-fuel oil” to meet the country’s energy needs. The result was “thick layers of toxic smog” in many Iranian cities and power cuts.
Iran has previously struggled with economic burdens as US sanctions isolated the country from foreign financial institutions. In addition, the problem is also the situation related to the global pandemic – about 1.3 million cases and the current winter – temperatures in Tehran are just above zero.
Bijan Namdar Zanganeh, the Iranian oil minister, has reportedly denied that any power plants in the country use inferior fuels. However, news sites commented the seemingly worsening situation in Tehran. According to the IQAir, the city’s air quality registers are “unhealthy” with an air quality index of 171 at the time of publication.
Legal cryptocurrency mining in Iran
In January last year, the Iranian Ministry of Industry, Mining and Trade announced that it had issued 1,000 licenses to cryptocurrency miners. This followed the government’s decision to permit approved mining activities in July 2019. Authorities later allowed power plants to operate as BTC miners “if they adhered to approved tariffs”, had the necessary licenses and did not use subsidized fuel.
Some Iranian officials are still working to make the country a safe haven for cryptocurrency miners. In May, President Hassan Rouhani commissioned officials to prepare plans for a national crypto mining strategy. The number of mining operations in the country increased significantly in 2020, and the authorities granted the Turkish company iMiner permission to create a mine in Iran’s Semnan province, which will consist of 6,000 people. rigs.