Bitcoin scapegoat – Iran’s government blames miners for power outages
Although Iran is reeling from inflation and cryptocurrencies are increasingly becoming a viable alternative in the country, the Iranian mining industry is coming under increasing criticism and is now being blamed for power outages itself.
As Cointelegraph had reported, Iran is the „mining superpower“ in the Middle East alongside Pakistan, due to the fact that electricity costs in the country are subsidised by the state. In addition, bitcoin mining was recognised as an „industrial activity“ here last year, giving the Bitcoin Superstar industry an extra boost. It is estimated that there are more than 1,000 businesses registered as mining companies in Iran.
However, the industry is not really on roses, as regulators have repeatedly cracked down on illegal mining operations in recent months. To make matters worse, bitcoin prices in Iran are significantly higher than in the rest of the world because demand is particularly high here due to the weak national currency.
Now there is another point of contention, because there have recently been repeated massive power cuts in large conurbations.
On 16 January, Iranian media had reported that there were power cuts in large parts of the country. A look at social media shows that there had also been repeated outages before and after that date, with some cities experiencing them for as long as two weeks.
The authorities subsequently blamed Bitcoin, which is why more raids against mining companies followed. Observers assume, however, that the government wants to distract from its own failures with these measures.
Even the former environment minister Kaveh Madani takes this line in an interview with the Associated Press, because he sees Bitcoin as „an easy victim“ as a scapegoat. Rather, „decades“ of political failure would be the real reason.
Although the government is currently railing against Bitcoin, it does not seem to be tired of the cryptocurrency yet, as only last month it used it to process import payments from Venezuela.
Although the „love“ between Iran and Bitcoin is going through a bit of a crisis at the moment, this episode is not the end.