The majority of governments worldwide are focusing on developing crypto-related legislation and regulations. Iran plans to regulate more stringent rules to prohibit illegal crypto mining. The Iranian government intends to move forward with new legislation to increase fines for illegal crypto mining.
While the government allows legal crypto mining, it clamped down on unauthorized mining last year to relieve strains on the country’s electrical infrastructure. In the case of repeated infractions, Iran’s new rule will involve incarceration and the revocation of company licenses.
Iran will make it illegal to overuse power
According to the Tehran Times, the additional stringent restrictions would boost fines by at least 3 to 5 times. In addition, according to a government official, the use of subsidized power provided for homes, industry, and agriculture to mine digital assets would be prohibited.
The increased overuse of subsidized electric power has been reported around the country. The official brought up that these illicit operations were putting a strain on the national grid’s electrical supply. The volatility is also harming people’s electric household appliances.
The Iranian government-approved cryptocurrency mining in 2019, but only for industrial purposes. As a result of this decision, mining has increased dramatically. The government later issued over 1,000 bitcoin mining devices at the start of 2020. The ministers even issued a warning to defaulters in May 2021, stating that they would be subject to significant fines if they continued to misuse power.
According to the newspaper, the regulation isn’t just about penalties; violators will also have to pay for the damage to the power network and system.
The energy consumption of mining is a contentious issue
Countries such as China have sent a strong message to the rest of the globe by imposing a national ban on crypto mining, citing worries about the act’s excessive energy consumption. Kazakhstan had also imposed restrictions on space due to the country’s serious energy constraints.
The European Union has agreed to prohibit mining-intensive cryptocurrencies due to their possible environmental effect. The plan was turned down.