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Iranian Authorities Crack Down on Illegal Crypto Mining

Since March, Iranian authorities have confiscated nearly 9500 unlawful crypto mining rigs in the nation’s capital, Tehran.  While crypto trading is still illegal among Iranians, the government’s use of crypto remains at an all-time high.

Iran Acts Against Illegal Miners

According to a report, Kambiz Nazerian, head of Tehran Electricity Distribution Company spoke on the matter. Nazerian said on Monday, August 22 that inspectors had uncovered the mining devices in various districts of Tehran.

Last year, a release from blockchain analysis firm Elliptic stated that Iran hosts 4.5% of all Bitcoin mining. 

The publication claimed that the nation uses its mining operations to evade US trading sanctions. Other reports suggest that the mining industry within the nation has also grown due to its cheap electricity rates. 

Interestingly, some of Iran’s mining setups are reportedly based in places that receive free electricity such as mosques and school buildings. However, the past few years have seen Iranian authorities crack down on these mining activities. In June this year, they cut off the power supply to 118 licensed mining centers ahead of a seasonal surge in power demand. 

Role of Crypto in Iranian Imports

Notably, even as they act against miners Iran appears also to be adopting digital assets in its foreign trade sector. Alireza Managhebi, head of Iran’s Importers Group and Representatives of Foreign Companies (Import Association commented on this. According to him, a solid regulatory framework is necessary for the nation to successfully merge crypto with imports. 

Managhebi also pushed for the government to train personnel to efficiently employ blockchain technology. 

The question is,” he said, “has the government developed consistent regulations for the cryptocurrency uses so that they will not change within two months and the businessmen active in this field will not be harmed?”

Managhebi’s main concern is that bringing crypto into imports could result in the creation of rent for certain groups. He cast doubts on whether the official use of crypto for imports could truly end the dollar dominance in Iran’s market.

He acknowledged that there would be benefits to such a move. However, it is important that they first establish and implement a proper regulatory structure. 

Crypto Trading Remains Illegal

Iran’s position on crypto remains an interesting subject of discussion. Evidence the government has turned to crypto to make trades exists. However, the authorities do not allow Iranians to make trades in the same capacity.

On August 10,  Iran carried out its first official import with crypto in an order valued at about $10M. There are no details regarding the nature of the imported goods or the crypto assets involved. Peyman-Pak, Head of Iran’s Trade Promotion Organization stated that the $10M order marks the first of many cross-border trades using crypto. 

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Yet, at the moment, Iranian law still does not permit residents to buy or sell crypto assets.  Ali Salehabadi, governor of the Central Bank of Iran confirmed this in an interview earlier this month. However, he noted that mining operations are lawful and persons with official authorization can also use crypto for imports.

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