Crypto Miners in Iran to Face Blackout as Mining Becomes Unprofitable

Authorities in Iran have announced that crypto miners operating in the country would have their access to electricity cut off by June 22.

According to a report from Tehran Times, the decision was made by the government to ensure there is enough energy supply for the citizenry.

A spokesman for the Iranian Energy Ministry, Mostafa Rajabi Mashhadi, said that the Asian country is anticipating a higher energy consumption rate from next week. 

He revealed that the country had recorded a record consumption of 62,500 MW during the peak period last week. That figure is expected to rise to 63,000 MW by next week.

This has forced the government into action to avoid a blackout.

Per Tehran Times, since Iran approved crypto mining as an industrial activity, the government has issued over 1,000 crypto mining licenses to several companies.

Apart from licensed operators, the country also has numerous unauthorized crypto miners who are placing more pressure on the national grid. The government has tried to crack down on these players at different times without much success.

As the value of Bitcoin and Ethereum continues to tumble to new lows, crypto miners are beginning to discover that the cost of mining these assets is becoming unprofitable.

According to data from CryptoRank, the drop in Bitcoin price has significantly made mining unprofitable. Per the data, the average cost of mining and Bitcoin price is now at par. 

This data was published on June 17, when Bitcoin was trading above $20,000. Since then, its price briefly fell below $18,000, meaning that mining the flagship asset would be more unprofitable.

In Ethereum’s case, the average cost of electricity in Europe and the U.S. makes the reward generated through mining unprofitable. 

For context, a miner using a single Nvidia 3090 machine would generate just over $2 in rewards per day. The miner, however, would be paying more for electricity than the block reward.