In recent weeks, Iranian citizens have faced unprecedented power outages, leading Iran’s capital and major cities to darkness. In this respect, millions of people spend the majority of nights without electricity in the dead of winter.
The government uses mazut and low-price fossil fuel to keep power plants running, causing a blanket of toxic smog and hazardous participles over the sky in Tehran. This is while Iran lies on the world’s second gas reserves. However, the leaders’ intractable decisions have isolated the country and prevented Iranians from using their natural resources.
The extraordinary air pollution endangers many citizens’ lives and health, particularly in the middle of the coronavirus pandemic. Iranian dissidents have reported the Covid-19 death toll has surpassed 205,000, which is a chilling number for an 80-million population.
This statistic — and even one-fifth of it — is enough to register Iran as the worst coronavirus-hit country in the Middle East. Now, the people must endure air pollution while they are being blamed by officials for the high Covid-19 fatalities.
In such circumstances, Iranian state media outlets and experts unveiled that the government is granting electricity to the Chinese for mining cryptocurrency at Rafsanjan Trade Zone in Kerman province, southeastern Iran. Furthermore, some media revealed that officials have established enormous Bitcoin farms in various areas.
According to reports, the government authorized 24 Bitcoin processing centers that consume an estimated 300 megawatts of energy a day, attracted tech-savvy Chinese entrepreneurs to tax-free zones in the country’s south, and permitted imports of computers for mining.
Tehran’s generously subsidized electricity has put the country on the crypto-mining map. In Iran, electricity goes for around 4 cents per kilowatt-hour, compared to an average of 13 cents in the United States. Furthermore, Iran is among the top 10 countries with the most Bitcoin mining capacity in the world — 450 megawatts a day.
On Tehran’s outskirts and across Iran’s south and northwest, windowless warehouses hum with heavy industrial machinery and rows of computers that crunch highly complex algorithms to verify transactions.
Notably, due to the national currency rial’s devaluation, officials have an indescribable appetite for untracked currencies like Bitcoin. In this respect, contrary to their publicity stunts and positions — trying to dominate the cryptocurrency industry —officials tempt their affiliated individuals to launch these farms.
“Iran’s government has sent mixed messages about Bitcoin. On one hand, it wants to capitalize on the soaring popularity of digital currency and sees value in legitimizing transactions that fly under Washington’s radar… On the other hand, the government worries about limiting how much money is sent abroad,” wrote AP on January 22.
Recent power blockages and using mazut for plants have prompted public ire against the government’s policies. In this respect, officials have been compelled to reverse some decisions out of fear of a spark in the country’s powder keg.
“The priority is with households, commercial, hospitals, and sensitive places,” said Mostfa Rajabi Mashhadi, spokesman of Iran’s electricity supply department.
However, it is unclear that how long this situation would last and when the government would launch cryptocurrency farms once again. Not least given that the new U.S. government has signaled that it has no immediate intention of offering multi-billion relief packages and pallets of cash to Iran.
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