RegulationBlockchainBitcoin
|3 min Read95% of Iran’s 427,000 Active Crypto Mining Devices Operate Illegally
Lucca Menezes
Senior Analyst
Published
Jan 16, 2026
Iran’s crypto mining industry is facing a massive illegal mining crisis, with authorities estimating that 95% of the country’s 427,000 active mining rigs are operating without proper authorization. The illegal mining activities are consuming significant amounts of power, destabilizing the national electricity grid.
A Widespread Illegal Mining Crisis
Akbar Hasan Beklou, CEO of the Tehran Province Electricity Distribution Company, stated that Iran has become the world’s fourth-largest crypto mining hub, largely due to the country’s heavily subsidized electricity prices, which have turned it into a "paradise for illegal miners."
These unlicensed operations are using over 1,400 megawatts of power around the clock, placing immense pressure on the national grid and threatening the stability of electricity supplies. Many of these illicit miners disguise their operations as industrial facilities to access the cheaper electricity rates.
Iran Cracks Down on Illegal Crypto Farms
The government has ramped up its crackdown on illegal mining operations. In Tehran Province alone, 104 unauthorized mining farms have been shut down, and 1,465 mining machines were seized. The electricity consumption from these devices equals the energy usage of nearly 10,000 households.
Several areas have been identified as hotspots for illegal mining, including Pakdasht, Malard, Shahre Qods, and industrial zones in southwestern Tehran. Inspectors have even uncovered mining operations hidden in underground tunnels and factories using subsidized power connections to avoid detection.
Beklou confirmed that specialized inspection teams are collaborating with law enforcement to dismantle these illegal operations.
Iran Offers Cash Rewards for Reporting Illegal Mining
To further combat illegal mining, the Iranian government has introduced a reward system for citizens who report unauthorized mining operations. In August, Iran announced that informants will receive a reward of 1 million toman (about $24) for each illegal mining device they report.
According to a June report by CoinLaw, Iran ranks fifth globally in Bitcoin hashrate distribution, contributing 4.2% of the total network’s computing power. The United States leads the world with a dominant 44%, followed by Kazakhstan (12%), Russia (10.5%), and Canada (9%).
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