Iran halts mining activities. Will Bitcoin suffer?

Namrata Shukla
Source: Pixabay

As December gets colder, Iran was keeping a close eye on its energy consumption. While deliberating the same, the local energy authorities have decided to halt operations of authorized cryptocurrency mining centers.

According to reports from local publications, the announcement was made by the chairman of the board and managing director of Iran Grid Management Company [Tavanir], Mostafa Rajabi Mashhadi. He noted that Iran was closing crypto mining centers to reduce liquid fuel consumption in power plants amid dropping temperatures.

This was not the first time the Iranian authorities have taken such a decision. Mashhadi noted that the authorities took similar action last month to reduce energy consumption. He stated,

“The Energy Ministry has been implementing measures since last month to reduce the use of liquid fuels in power plants, including cutting licensed crypto farms’ power supply, turning off lampposts in less risky areas, and stringent supervision of consumption.”

Iran was among the leading countries when it comes to mining and actively accounted for nearly 4.5% to 7% of the bitcoin hash rate. It had shut the mining activity back during summers, as the temperatures soared. The country noted historically peak periods for power demand at the time, causing it to shut mining operations. However, the ban was lifted in September with a stabilizing power grid.

Mashhadi yet again focused on the importance of conserving energy and urged its citizens to reduce their electric and gas consumption. This cooperation from the people was needed as the country reported 70% of the fuel consumption for heating buildings. With the new measures, the authorities hoped to cut energy consumption by at least 40%.

The impact of this on the Bitcoin hash rate is yet to be felt, but the traders and hodlers should consider themselves warned.