Iran Cracks Down on Illegal Crypto Mining Consuming National Power

Officials now admit that almost all of the country’s active crypto mining devices are operating without a license, a shadow network so vast it’s consuming more electricity than some provinces.

The Secret Life of Iran’s Miners

In Tehran’s industrial zones, inspectors have stumbled upon a new breed of factory — one that produces nothing but heat and noise. Mining farms have been discovered inside textile warehouses, food plants, and even underground tunnels. These facilities tap into heavily subsidized power, a loophole that has made Iran one of the world’s cheapest places to mine Bitcoin.

Local authorities say the country has unknowingly climbed to fourth place globally in crypto mining output, trailing only the United States, Kazakhstan, and Russia. But the boom has come at a price: more than 1,400 megawatts of electricity are being drained daily by illegal operators, threatening to destabilize the national grid.

The Crackdown

The government’s response has grown increasingly aggressive. Energy inspectors, now working alongside law enforcement, are conducting raids across the country. In the Tehran Province alone, over 100 illicit farms have been dismantled this year, with 1,465 mining rigs seized — enough, officials say, to power 10,000 homes.

But shutting them down hasn’t been easy. Many of the unlicensed facilities relocate within days, setting up shop in new industrial districts or remote agricultural areas. “They hide in plain sight,” one utility official admitted, explaining that the miners often register as small manufacturers to secure cheap energy access.

Cash for Clues

Unable to keep up with the scale of the problem, authorities have turned to the public for help. Iran’s state power utility Tavanir now pays 1 million toman (about $24) to anyone who reports an illegal mining machine. The unusual bounty system has turned citizens into de facto energy watchdogs, with reports flooding in from disgruntled neighbors and factory workers.

A Country Built on Cheap Power

Iran’s energy policy is part of the problem. Decades of subsidies have kept electricity prices among the lowest in the world — a legacy that has made the country a magnet for energy-intensive industries. Crypto miners, drawn by costs a fraction of global averages, set up vast operations long before regulators realized how much power was disappearing.

According to CoinLaw, Iran now contributes 4.2% of Bitcoin’s global hashrate, ranking fifth worldwide. That means thousands of unlicensed rigs are quietly helping secure the Bitcoin network, even as Iranian officials denounce them for draining power and destabilizing cities.

Between Profit and Outage

For Tehran, the dilemma is stark. Legal mining could bring in much-needed foreign currency at a time when international sanctions restrict trade. Yet every unauthorized operation pushes the grid closer to failure, fueling blackouts and public anger.

Authorities have vowed to continue their crackdown — but each time a mining farm is dismantled, another one surfaces. In a country struggling with inflation and unemployment, the lure of free power and digital profit is hard to resist.

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