A new study, just recently discovered that around 4.5% of all bitcoin mining takes place in Iran. This allows the country to earn billions of dollars via Crypto Currencies. This money can be used to import goods and reduce the impact of the sanctions imposed on the country.
According to the figures shown by the blockchain analytic firm Elliptic, with the current level of mining, Iran bitcoin production and mining almost would round up to a revenue of almost $1 billion a year.
However, officials from Iran should not be asked to comment on this right away, the experts say.
The United States inflicted a total economic ban on Iran, which includes a ban on all imports from Iran including those from the oil, banking and shipping sectors of the country.
The reports show that almost up to 600 MW of electricity was being consumed by miners to create crypto currencies.
Bitcoin and other cryptocurrencies are generated through a process which is known as mining. In this process, powerful computers compete with each other and solve complex mathematical problems. The process of crypto mining is very energy intensive and often relies on electricity which is generated by fossil fuels which Iran is rich in.
Iran only recognized crypto mining as an industry, just in recent years. It offers cheap power and the requiring miners can sell their bitcoins to the central bank.
Iran officially recognized crypto mining as an industry in recent years, offering it cheap power and requiring miners to sell their mined bitcoins to the central bank.
The study says- “Iran has recognised that bitcoin mining represents an attractive opportunity for a sanctions-hit economy suffering from a shortage of hard cash, but with a surplus of oil and natural gas.”
The energy and electricity used to mine crypto currency in Iran require around 10 million barrels of crude oil a year. This generated around 4% of the entire Iranian oil exports last year in 2020, says the study.
The electricity being used by miners in Iran would require the equivalent of around 10 million barrels of crude oil each year to generate, around 4% of total Iranian oil exports in 2020, according to the study.
“The Iranian state is therefore effectively selling its energy reserves on the global markets, using the Bitcoin mining process to bypass trade embargo… Iran-based miners are paid directly in Bitcoin, which can then be used to pay for imports – allowing sanctions on payments through Iranian financial institutions to be circumvented,” the study says further.
