April 17, 2022 by Lipika Deka
The Iranian administration has decided to pass new legislation, increasing penalties to prevent illegal cryptocurrency mining from using subsidized electricity, an official with the country’s Power Generation, Distribution, and Transmission Company [known as Tavanir] announced.
According to the Tehran times coverage, the increase in punishments includes rising fines by a minimum of three and a maximum of five times, imprisonment of the offender, and even cancellation of their business license for repeated violations.
“Any use of subsidized electricity, intended for households, industrial, agricultural, and commercial subscribers, for mining cryptocurrency is prohibited,” Mohammad Khodadadi Bohlouli, an official working with the power firm said.
Misusing subsidized electricity to mine cryptocurrencies reduces the quality of the electricity supply in the national grid and damages peoples’ electrical appliances such as televisions, refrigerators, air conditioners, and so on, the official noted.
Iran: Illegal crypto miners can no longer avail subsidized electricity 3
Following the Iranian government’s approval of cryptocurrency mining as industrial activity in 2019, numerous mining rigs cropped up across the nation, thanks to the extremely low-cost electricity. In January 2020, the Ministry of Industry, Mining, and Trade has issued over 1,000 licenses for such mining units.
But amongst them, some unauthorized miners also started mushrooming which used household electricity, causing major issues for the country’s electricity industry which is already facing serious problems created by drought and reduced rainfall.
Finally, in May 2021, the Iranian Energy Ministry’s Spokesman for the electricity sector Mostafa Rajabi Mashhadi warned that those cryptocurrency miners using subsidized electricity would have to pay a heavy fine if identified.
In addition to that, those miners must also compensate for the damages they cause to the electricity network, Rajabi Mashhadi added.
Iran’s Crypto-Rial would go live soon
With regards to crypto legalization, the west Asian country does not recognize cryptocurrencies as a means of payment, a high-ranking government official has emphasized. His statement came as the Central Bank of Iran announced rules for the issuance of digital coins in the country, five days ago.
Dubbed “Crypto-Rial,” the pilot phase will begin in the near future. Without giving any specific dates, the Central Bank stated that the Crypto-Rial would play a bigger role and would provide a competing platform for stablecoins used globally.
