Authorities in Iran have seized around 1,000 Bitcoin mining computers from two separate abandoned factories, according to Reuters.
“Two of these Bitcoin farms have been identified, with a consumption of one megawatt,” Arash Navab, a power official in the central province of Yazd, told a state television.
The news comes just days after local media reported that Iranian officials were blaming the country’s recent increase in energy consumption used by cryptocurrency miners, after seeing a 7 percent increase in energy consumption near the end of June 2019.
At this time, Iran was implementing a nationwide ban on digital assets, and using the country’s national grid to power cryptocurrency mining machines is considered an illegal activity.
In April 2018, Iran‘s central bank prohibited other banks from dealing with cryptocurrencies over money-laundering concerns.
But since September 2018, Iran‘s Supreme Council of Cyberspace was drafting ways to recognize cryptocurrency mining as a legitimate industry.
"Everyone's talking about Bitcoin and how to get it," said Mahsa Alimardani, a researcher at the Oxford Internet Institute, who grew up in Iran.
With U.S. sanctions over Iran's nuclear program, the country has been hit financially. Some officials in Iran believe that cryptocurrency could be a solution to help mitigate those international sanctions placed.
Iranians often discuss how wealth can be gained and stored securely on the internet, sharing ways how to do that via social media networks. Both gold and U.S. dollars are the two long-standing suggestions, and "Bitcoin and [other cryptocurrencies] are slowly coming up as the third alternative," she said to the BBC.
Access to cryptocurrency also appears to be helping residents evade U.S.-imposed banking sanctions.
Mining cryptocurrencies like Bitcoin involves computers, usually specialized mining machines to solve sophisticated mathematical problems associated with a block containing cryptocurrency transaction data via the internet.
These dedicated computer hardware has specialized graphical processing unit (GPU) chip or application-specific integrated circuit (ASIC), sufficient cooling means for the hardware, an always-on internet connection, a legitimate cryptocurrency mining software package, and membership in both an online cryptocurrency exchange as well as an online mining pool.
By providing computing power for validating transactions on that network, mining machine owners are rewarded with newly generated coins. But what makes mining an increasingly difficult task is that, cryptocurrency usage has grown exponentially.
As a result, the competition has increased substantially. And when done at a large scale, the process can be a potentially lucrative exercise.
With the power required to mine 1 Bitcoin equals to the amount required to light 24 households for a year, Iran which subsidizes its power to keep the prices low, appears to be one of the reasons why miners have been operating in the country.
Government reports also cited that cryptocurrency mines have been set-up in schools and mosque where electricity is free.