Low Cost Electricity Has Bitcoin Mining Farms Flocking to Iran to Stay Profitable
The price of electricity in Iran during June 2018 was 0.03 U.S. Dollar per kWh. For comparison, the average price of electricity in the world for that period is 0.14 U.S. Dollar per kWh.
This makes Iran one of the cheapest destinations for electricity consumption. It is of no surprise that crypto miners around the world are looking at the country as their next destination.
Chinese Miners Looking At Iran
With the rapid downfall of Bitcoin and increasing electricity bills, Chinese mining investors are looking for solutions to sustain their businesses. With the increasing difficulty of calculation, people have developed an ASIC miner, especially for the specific algorithm. It possesses strong computing power, but similarly, consumes a lot of electricity.
The domestic regulations in China of mines have been tightened with the cost of power on the rise. Also, the average price of mines extends from something over 6 – 8 gross leading to the higher cost of production and decreased revenue and gain.
Chandler Guo, commonly designated as “BitAngel” in the crypto ecosystem said:
“I have already found a power station with 4 cents electricity in the Middle East. It is suitable for all kinds of second-hand mining machines that will be shut down. Investment can be returned in one month. Whoever wants to join, you are welcome”.
When Guo disclosed his finding to the public, many miners have gathered from all across China to inspect the proposed new site for mining – Iran. The low-cost electricity that Iran offers implies that many miners will be back into the business, and hopefully, they can revive mining and the general price of Bitcoin in the capital.
BitAngel prophesied that many miners would be interested in the Iran electricity discovery. Surprisingly, the number of people that have shown interest in the project rose to 500 within a couple of hours after the announcement.
Several large mine proprietors from China have visited Iran for inspection over the past weeks.
Problems With US Sanctions
U.S. sanctions against Iran have had a crippling effect on the country. Now, Iranian bitcoin users are feeling the effects of those sanctions after the United States government announced action against two bitcoin addresses used in ransomware attacks.
CoinDesk had interviewed an Iran-based cryptocurrency miner who described the situation as “alarming”. That miner claims the stigma against Iranian bitcoin users negatively affects all bitcoin users in the country. Over the past two years, that miner has been mining bitcoin to support family abroad. The miner relies on cryptocurrency-related profits to support his family at home and overseas. The latest political news has him worried about the future.
One attorney recommended that Iranian bitcoin users who received bitcoin from the sanctioned addresses should alert U.S. authorities. Iranian bitcoin users, of course, are unlikely to trust the U.S. government with any information.
Mining operations continue to expand across the country even as bitcoin prices dip. While crypto miners across the world are struggling to scrape by, crypto miners in Iran continue to make it work.