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Bitcoin and controversy go hand in hand ever since the advent of the crypto asset. Today, Countries around the world are seeking to regulate the booming crypto industry.
The authorities in Iran banned unauthorized mining last year to save energy supply in the country although the government allows regulated cryptocurrency mining.
Now, the government in Iran plans to introduce new sets of legislation that aim to increase the penalty associated with illegal Bitcoin mining.
Penalties To Increase Under New Crypto Legislation
A senior official involved with the Power Generation, Distribution, and Transmission Company (Tavanir) of the country, revealed that under the new legislation, violators will be jailed and it also involves canceling business licenses.
Mohammad Khodadadi Bohlouli shares that the fines will be increased by a maximum of five times, and a minimum of three times as part of increased penalties, the offender will be arrested and in case of repeated violations, the business license can be revoked.
The official further explains that mining cryptocurrencies using subsidized electricity deteriorates the electricity supply of the national grid and also damages home electrical appliances like refrigerators, televisions, and air conditioners.
Khodadadi calls it unlawful to use subsidized electricity that is meant for homes, agricultural, commercial subscribers, and industrial, for mining cryptocurrencies.
Frequent Power Shortages Due To Mining
In late May last year, Iran cracked down on cryptocurrency mining for almost four months. The move it said was taken as a measure to decrease the frequency of power shortage that as per the official happens due to the increasing electricity demand in the season of hot and dry summer.
According to IRNA, Gen. Hossein Rahimi, Tehran police commander informed that 7,000 computer miners were found in an abandoned facility in the capital’s west.
Cryptocurrencies including Bitcoin are generated through mining, a process that includes a range of computers solving complex mathematical puzzles. The mining process is quite extensive and requires frequent doses of electricity from fossil fuels, which are abundant in Iran.
The government of Iran showed green light to Bitcoin mining in the year 2019, however only for industrial purposes.
After the ruling, mining activities in the country spiked. Then in late 2020, the authorities issued over 1,000 cryptocurrency mining equipment.
Iran Accounts For A Major Chunk Of Bitcoin Mining
According to a study from Elliptic, a blockchain analytics firm, 4.5 percent of all bitcoin mining activities take place in Iran which generates revenue in millions of dollars in cryptocurrency that can be leveraged to reduce the impact of sanctions imposed by the US.
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Nancy J. Allen is a crypto enthusiast, with a major in macroeconomics and minor in business statistics. She believes that cryptocurrencies inspire people to be their own banks, and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning. She frequently researches, and posts content on the top altcoins, their theoretical working principles and technical price predictions.
