Iran has joined the growing list of countries that are attempting to ban cryptocurrency mining due to electricity and power concerns.
The Iranian Ministry of Energy came to the decision following a noticeable spike in power consumption this month. Energy official Mostafa Mashhadi reportedly revealed an unusual seven percent increase in electricity usage during June, prompting the ministry to take action.
The spike has been blamed for outages affecting the nations electricity supply and has allegedly been traced back to cryptocurrency mining activities. The ministry is now considering a new pricing structure that would effectively render cryptocurrency mining unprofitable.
Following sanctions imposed by the U.S., Iran was briefly considering launching its own government-backed cryptocurrency in August last year. In November reports emerged suggesting that the project pilot phase had completed successfully and the country was waiting on approval from the Central Bank of Iran (CBI) before going further.
Growing Crypto Bans
Iran joins a list of countries that have banned or are planning to ban cryptocurrency activities such as mining or trading. Most famously, China has recently announced plans to increase its restrictions on cryptocurrency mining in the country.
As reported by Forbes magazine in April this year, China’s top economic planning committee, the National Development Reform Commission, put forward a proposal for a ban on crypto mining in the nation. The commission claimed the move was due to environmental concerns but the Forbes report indicates its more likely to do with a conflict of interests in the government.
India is another country that has famously banned the use of cryptocurrency entirely, going so far as to threaten the arrest of any citizen using them. The move has caused the closure of several crypto exchanges in the country and drawn widespread criticism from the industry.
A report from local publication The Economic Times pointed out the utility of stablecoins as a mean of international remittance, something India benefits greatly from due to its extensive overseas workforce. With many nations increasingly losing faith in the U.S. dollar reserve system, blockchain-based digital currencies could be paramount in ensuring the future stability of the world economy.
The cryptocurrency market
Following a week of exponential gains that saw the cryptocurrency market add $100 billion worth of value, the past 24 hours have seen it suffer a major correction. The price of market leader Bitcoin (BTC) collapsed quickly from $13,500 to current levels below $12,000 and Ethereum (ETH) fell from $350 to $310.
However, corrections such as these are common in markets that enjoy sudden and unsustainable growth. Analysts predict further long-term gains for Bitcoin and the rest of the market, with some suggesting Bitcoin may reach a new all-time high (ATH) soon.
Mark Hartley is a Microsoft-qualified IT professional and freelance writer specializing in finance and technology. He has traveled to 56 countries worldwide and spent time working on the trading floors of some of the largest banks and brokers in London, helping to integrate cryptocurrency technology into the IT trading infrastructure. You can contact him on twitter @cryptodiscourse or via email at firstname.lastname@example.org. *All information provided here is for educational purposes only and should not be taken as financial advice.
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