Iran Planning to Switch Back to Regulated Mining Amidst Sanctions

President asks to set up a legal framework for cryptocurrency mining
  • Iran seeks to prepare for a controlled and regulated process of crypto mining as the country bypasses US sanctions through it
  • The Iranian President asks his Government to plan out a legal framework for regulation of cryptocurrency in the country
  • To evade US sanctions risks, the country indulges in crypto asset transactions to get out of the chasmal recession
  • Cryptocurrency mining bans by the Government continues to persist in Iran till the month of September

The middle eastern country finds an unlikely solution to oil export restrictions posed by the United States. Mining cryptocurrency, especially Bitcoin, becomes Iran’s saviour as it gradually replaces the loss of cash revenue for the economy. The President, Hassan Rouhani, has asked the Iranian Government to start proceedings with establishing a regulated process of crypto mining.

Iran banks on Bitcoin after dollar trade restricts the economy

President Hassan Rouhani believes that a regulated crypto structure could benefit the economy of the country. He plans to extract any illegal crypto business out of the system and protect his people’s capital at any cost. In the early months of 2021, the President’s think tank advised and promoted the people to invest their time and energy in mining as a solution to the dropping cash reserves of the country. 

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The country’s estimated Bitcoin mining capacity constitutes 4.5% of the globally mined coins. The rate is comparatively high because of cheaper electricity costs and the cooperation of the Government which led to massive Chinese mining plants set up in the country. The people could sell the coins to the Central bank after mining them. This raised the demand of mining in the country after a deep recession caused by the oil sanctions. The country is still a developing country even with a global fiat money. Hence, resorting to crypto, just like El Salvador, seems to be the next best option according to the Government. Even with restrictions on trades that involve dollar transactions, the country is bound to find an alternative and open its gates to Bitcoin.

Cryptocurrency ban still lingers in the country 

However, in the month of May, the President had banned the mining process due to lack of energy and continuous blackouts in various cities in Iran. Illegal and unlicensed activities involving cryptocurrency also peaked and aggravated the Government to put a ban on mining for 4 months. The ban still prevails till the month of September but the authorities are not quite against crypto. Majorly due to electricity problems, they had to cut down on mining. The country is a big acceptor of cryptocurrency. It allowed its people to start mining a few years back and even lowered the electricity costs last year which led to extra usage and hence a power cut resulted from it. 

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Steve Anderrsonhttp://www.thecoinrepublic.com
Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain.

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