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- Iran has banned cryptocurrency mining over the summer ahead of an anticipated surge in electricity demand, Bloomberg reported.
- The ban is effective immediately until September 22.
- Approximately 4.5% of all bitcoin mining occurs in Iran, according to Elliptic.
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Iran has banned cryptocurrency mining over the summer ahead of an anticipated surge in electricity demand, Bloomberg first reported. The country the past few days has experienced widespread blackouts due to higher than usual energy consumption, compounded by drought and high temperatures, according to Arab News.
While cryptocurrency mining was highlighted, other electricity-intensive activities were also prohibited, President Hassan Rouhani announced on state television Wednesday.
"The ban on the mining of cryptocurrencies is effective immediately until September 22," Rouhani said as Reuters reported. "Some 85% of the current mining in Iran is unlicensed."
Cryptocurrency mining has long been criticized due to its heavy energy use and environmental impact. Various research, including a study from Cambridge University, has shown that bitcoin mining around the world uses more energy each year than some entire nations.
Mining cryptocurrencies, a complex process that includes validating data blocks to include in the public ledger, is power-intensive and often relies on fossil fuels.
Approximately 4.5% of all bitcoin mining occurs in Iran, according to blockchain analytics firm Elliptic.
The fact that the country has restricted access to foreign currencies also makes cryptocurrency mining more attractive.
The ban however raises concerns about pushing the practice -including those licensed-into the black market. Iran in the past has launched a crackdown on illegal miners, accordin to Bloomberg.