Tuesday, January 19, 2021

Bitcoin (cryptocurrency) Mining in Iran causes blackouts and smog?

2021, things will get better, right?  Well...  

In a strange dystopian twist last week, a story has been developing in Iran.  Massive power disruptions have been sweeping across Iran.  Apparently this has been an issue since January 13.  At the time, the cause was unclear, as reported by GardWorld.  

The dystopia is worse.  Due to the demand on power over the past month, power plants in Iran have been forced to switch over to burning low-grade fuels oil, causing massive "toxic" smog around the capital city, as reported by Bloomberg.  Other reports about increased smog go back to January 3.

Here's what makes the whole thing even more surreal.  According to Iranian officials, a major contributing factor (in addition to the unusually cold winter) is apparently illegal cryptocurrency mining operations, as reported by the Washington Post.  However, this is may not be a major cause, as cryptocurrency miners state their operations have nothing to do with the current power crisis.

Iran reportedly cracked down on cryptocurrency mining operations on Sunday by confiscating 45K machines.  Supposedly, these machines were consuming 95 megawatts per hour, while paying a reduced rate on the electricity.   However, the crackdown may not be about power consumption, as other reports suggest power consumed in cryptocurrency mining has only a minor role in Iran's current power crisis, as reported by coindesk.  In July 2020, "Iran penned a registration directive forcing [cryptocurrency] miners to disclose their identities" and "the size of their mining farms".  

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