The cryptocurrency industry has entered an interesting phase over the past few months. Various countries are looking to regulate this industry, albeit it doesn’t appear too many efforts will formally materialize in the near future. Iran is one of the first countries to double down on this aspect, as some very interesting decisions have been made throughout the past few months. It is still too early to tell if these regulations will be beneficial or a hindrance.
Confirming the Legality of Bitcoin Mining
There have been some persistent rumors regarding the situation of cryptocurrency mining in Iran. Although most experts expected this industry to be legitimized sooner rather than later, there are never any guarantees where regulation is concerned. Late last week, the government has officially confirmed cryptocurrency mining is an official industry and the activity is deemed legal in Iran. This will put most of the speculation to bed once and for all. It also provides local cryptocurrency enthusiasts with an additional revenue stream to explore for many years to come.
What is rather interesting is how the government decided to take a positive stance toward mining in terms of location-based efforts. Users can perform this action within and outside of metropolises, as well as special trade zones. There is one caveat, however, as miners will need to obtain an official permit. Those permits are issued by the Ministry of Industry, Mine, and Trade. It is unclear how difficult it would be to obtain such a permit, although that will become apparent in the weeks and months ahead.
Building new Power Plants
The cryptocurrency mining industry is very electricity-intensive. In countries such as Iran, one would expect issues to arise if too much electricity is drawn from the existing power infrastructure. To counter that problem, the government plans to build new power plants which operate outside of the current grid system. Any electricity provided by those entities would be used directly for cryptocurrency mining. For the time being, there is no indication as to how many additional power plants will come online in the country. Until more clarity arises, miners will be able to draw power from the normal grid without any problems.
What About Electricity Pricing?
When it comes to the price of electricity, however, there are still a lot of unknown factors to take into consideration. At this time, there is no indication as to how much cryptocurrency miners will pay per KwH. Those rates will be announced in the near future. Considering how the use of electricity for crypto mining is prohibited during peak hours, some alternative solution will need to be introduced in the not-so-distant future. Most countries do not take kindly to this activity and tend to charge very high electricity rates. Once all of these issues are taken care of, the true impact of legalizing cryptocurrency mining in Iran will become apparent.
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