The Iranian authorities have announced that they will allow industrial-scale power plants to mine bitcoin using their infrastructure. The directive applies to all licenced power plants across the country enabling them to now operate as bitcoin miners.
According to the directive issued by the country’s Power Generation, Transmission and Distribution Management Company, plants are open to mining bitcoin as long as they have the requisite licences and ensure compliance with the approved tariffs. This in part means that those power plants considering venturing into bitcoin mining will not be allowed to use subsidized fuel in such operations. This was made clear in the statement issued by Mostafa Rajabi Mashhadi, a Deputy Managing Director at Tavanir to the Islamic Republic News Agency (IRNA) on July 27.
Now and in a situation where the supply of electricity is of great importance to the public, we will not allow those who misuse the tariffs provided for the agricultural and industrial sectors to produce bitcoins that are worth more.
Despite this strong stance, Mashhadi was quick to point out that Iran has some of the cheapest electricity tariffs globally. This means that power plants could easily turn a profit from their bitcoin mining venture even without the government subsidies. This was affirmed by a spokesman of the electricity industry who stated that even power plants to perating off the grid usually operate within the sector with 70% of the export fuel price. As such, Iranian power plants are greatly incentive to begin bitcoin mining even without depending on the government subsidy.
The new directive from the Iranian authorities is a potential game changer in the bitcoin mining industry as competition continues to heat up. As the difficulty of mining bitcoin keeps rising, miners are collaborating to create large mining pools with huge hash power. However, the cost of running such huge pools is high resulting in miners seeking locations with cheaper electricity. As the new directive takes place, Iran is now positioned as a highly suitable location for setting up bitcoin mining operations due to the low cost of electricity. Earlier this year, the Iranain Trade ministry issued 1,000 crypto mining licences after it gained authorization as an approved industrial activity in mid-2019. These factors point to a huge bitcoin mining potential in Iran that is ripe for picking. Now bitcoin miners and power plants can exploit this opportunity to maximize their capacity and boost revenues.
Image courtesy of pixabay
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