Iran New Regulatory Scheme Includes Crypto Mining Licenses
September 5, 2022 8:16 AM
It has been reported that the Iranian government has begun issuing licenses to cryptocurrency miners in accordance with the new "comprehensive and detailed" regulatory framework that was approved just last week. Several cryptocurrency mining operations had been issued licenses by the government before the process was halted due to concerns over energy consumption and illegal mining.
Iran Reopens Crypto Mining Licenses
In a meeting last week, the Iranian government approved a set of "clear and comprehensive" crypto regulations, which includes provisions for crypto mining.
According to local media outlets, Iran's Minister of Industry, Mine, and Trade Reza Fatemi Amin has announced that his department will once again be able to issue crypto mining licenses. These are his alleged words that were reported:
"Government decisions allow organizations that apply to mine crypto assets to obtain both a business license and a mining license."
To begin cryptocurrency mining in Iran, an organization must first obtain both a business license and an operating license. The first verifies the entity's legitimacy as a cryptocurrency miner, while the second frees it to begin mining digital currencies.
Secretary of the government's working group on cryptocurrency Mohsen Rezaei Sadrabadi recently shared some details of the newly approved crypto regulatory framework, including the fact that mining centers can now apply for a license and use mined cryptocurrencies to pay for imports.
He said the new regulatory framework includes provisions that address large-scale crypto mining operations and that licenses for cryptocurrency miners are issued by the Ministry of Industry, Mines, and Trade. Provisions are also made regarding the provision of energy to the mining industry, with renewable energy receiving top priority.
And as Rezaei Sadrabadi pointed out, the government has decided to make the central bank the primary regulator of the crypto sector. But he thinks crypto regulation should be multi-dimensional, and that no single regulator should be in charge of the entire sector, because the crypto ecosystem is about more than just cryptocurrencies.
In 2019, the Iranian government legalized cryptocurrency mining but prohibited cryptocurrency trading within the country. Later on, a regulatory framework was put in place that mandated crypto miners obtain a license, reveal their identities, pay higher electricity rates, and sell their bitcoins directly to the government. Iran amended some regulations in July to facilitate cryptocurrency miners' use of renewable energy.
Due to extreme weather putting strain on the country's power grid in the winter, the Iranian government ordered licensed cryptocurrency miners to temporarily halt operations in December of last year. After announcing a four-month ban on cryptocurrency mining in May, the national electricity company eventually lifted the ban in the middle of September after licensed cryptocurrency mining facilities voluntarily shut down their operations.
Under the previous rules, Iran issued over a thousand crypto mining licenses. In May, Iran's government announced that nearly 6,914 underground cryptocurrency mines had been dismantled. According to Tavanir, Iran's Power Generation, Distribution, and Transmission Company, nearly 85% of the country's cryptocurrency mining electricity consumption comes from illegal operations. Since March, nearly 10,000 illegal crypto mining devices have been seized despite the government's threats of harsh measures against those who use them.