Bitcoin mining yields in Iran may exceed $1B annually
Bitcoin has turned into a way of bypassing the oil sanction by the Iranian government and a payment method for their imports.
Elliptic, a blockchain analytics firm, believes that regulated mining activities in Iran may surpass $1 billion in revenues despite the fact that the Iranian government didn’t have a clear plan and decision regarding Bitcoin regulation previously, changing their mind form from being a totally illegal activity to accepting and regulating Bitcoin mining which has now turned into a tool to circumvent the country’s economic embargo that was imposed by the US.
As you can see in the figure above, according to Elliptic, Iran’s share of the total global Bitcoin mining operation is 4.5% which aids the local government to make billions of dollars through which they can evade the US oil sanctions and sell the oil easily:
“The US imposes an almost total economic embargo on Iran, including a ban on all Iranian imports and sanctions on Iranian financial institutions,” says the report. “Oil exports have plummeted 70% over the past decade, leaving the country in a deep recession with soaring unemployment and periods of civil unrest.”
It also says:
“In the face of these sanctions, Iran has turned to an unlikely solution - Bitcoin mining.”
According to the report, these mining operations unlike other countries are not very expensive as the country possesses tons of cheap oil it can use. Being cheap to mine, Iran has attracted foreign investors like China that have started mining in Iran and developed this crypto-economy even more. The report also says:
“Several Chinese businesses have been granted mining licenses and have established operations in the country. These companies have described establishing good relationships with ‘the army in Iran’, and one particularly large facility in the Rafsanjan Special Economic Zone was reportedly built in collaboration with a ‘military organization’,”
After running cold and hot regarding their position with Bitcoin, The local government finally allowed banking entities to use cryptocurrencies to buy imports in late April. Following the same policy, the government tried to have tighter control over the crypto sector by passing a law to ban the use of foreign-mined BTC for imports.
The country has not always been so welcoming or friendly with mining and Bitcoin. Previously, Iran had faced several power outages and the Iranian officials attributed those outages to the illegal mining activities in the country. Also, the Iranian intelligence agency has been ordered to catch illegal miners.
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