The government of Iran has noted that power plants can mine cryptos such as Bitcoin. However, miners do not have access to subsidies.
According to the authorities, Iranian industrial-scale power plants can now operate as Bitcoin miners as long as they do not utilize subsidized fuel.
The new development was revealed in a statement to the Islamic Republic News Agency (IRNA) on July 27. The requirements for operating Bitcoin mines were revealed in the words of Mostafa Rajabi Mashhadi, a Deputy Managing Director at Tavanir, Iran’s Power Generation, Transmission and Distribution Management Company.
The requirements for Iranian power plants to operate Bitcoin mines include compliance with approved tariffs and securing the necessary licenses. Further, Mashhadi noted that any power plant interested in running such a venture is not eligible to use subsidized fuel.
He said the country is currently in a situation where electricity supply is critical to the public. Hence, the government does not permit the misuse of tariffs offered to the agricultural and industrial sectors towards the production of Bitcoin while its value is over worth $9,000, he added.
In the beginning of this year, reports had it that the country’s Ministry of Industries, Mining and Trade had issued 1,000 licenses to firms into cryptocurrency mining since it was approved as an industrial activity last year.
IRNA reported that fourteen cryptocurrency miners in the country had requested over 300 megawatts (MW) of power, which is equal to the power consumed in three provinces, said a spokesman for the electricity industry.
Some market factors like fuel prices in the Middle East determine Iranian crypto miners’ tariff scheme. It takes huge megawatts of electricity to mine cryptos but electricity is quite cheap in Iran relative to other places worldwide. Based on the estimates by Mashhadi in 2019, about $1,400 in state subsidies will be required to produce one Bitcoin.