Tuesday, June 22, 2021

Translation of Oil to Cryptocurrency: Islamic Republic’s New Way to Circumvent Sanctions

Bitcoin mining in Iran has become a method for circumventing the sanctions. More than $3billion a year is regime's income, while Iranians suffer in blackouts.

A recent research by Elliptic has sparked a new range of articles in western and Islamic Republic media about how the regime in Iran is using the domestic BTC mining operations to circumvent US sanctions and earn $1billion a year up to April 2020. That is based on the Islamic Republic officials saying 600MW of electricity was used by miners in January 2021. According to the study, 10 million barrels of oil, about 4% of total Iran oil export in 2020, are required to make that happen.

Meanwhile, CEO of Tavanir (Iran’s generation, transmission and distribution of electricity company) asserted 2,000MW in the country is used for mining Bitcoin, which is equal to 30% of Tehran’s consumption or 2million households or 7 provinces! That is 3.3 times more than what Elliptic took into account for its report, which means $3.3billion annual income for the Islamic Republic, not balancing it with the current BTC value which has skyrocketed since when the study was conducted. That also means Iran have translated 33million barrels of oil into electricity to make that much money! It also increases Iran’s share in total worldwide mined Bitcoins to 15% and not 4.5%!

Iran’s Electricity Industry Spokesman claimed the permitted amount of electricity used for mining in Iran is 352MW by 2,266 units. But, Mostafa Rajabi-Mashhadi confirmed Tavanir’s CEO and reiterated about 2,000MW is consumed for this purpose! He said since Tehran’s consumption is more than 4,000MW, and most blackouts are occurring in the capital, it is safe to assume most of the illegal users are in Tehran. He did not offer any details about these “illegal users.” On August 17, 2020, he had announced 1,100 “illegal” farms were identified with the help of citizen reporting but either nothing was done then, or they just grew back like mushrooms!

Who Are the “Illegal” Miners?

HamshahriOnline: Bitcoin mining in Iran; from dairy farms to schools & mosques – Chinese are here too. June 18, 2019

On June 18, 2019, the first reports of BTC mining in mosques and Basij offices (IRGC militia group) across the country came to light. Those entities enjoy free electricity and their earnings are shared with the officials who smuggle the necessary mining equipment! July 7, 2019, an activist in electricity production in Iran, confirmed the reports about mining at mosques, agricultural farms and barns!

During this round of blackouts, Tavanir’s CEO reported his agents were shot in Markazi province when they went to close an “illegal” mining farm. Motevalizadeh claimed he had submitted a complaint to the Judiciary and police.

Mohammadreza Sharafi, a member of Iran Blockchain Association, says if the CEO’s claim is accurate, he must clearly state who owns and operates that mining farm since no ordinary citizen has a registered gun and nobody dares to shoot at officials when the punishment for such crime is death penalty! Sharafi implied IRGC’s involvement by saying, whoever shot at the them, was from an organization with guns and not afraid of getting arrested.

Despite the widespread blackouts endangering the lives of COVID-19 patients on oxygen generators or patients in operating rooms, students missing their final exams, spoiled COVID-19 vaccines, and many other aspects of lives impacted, the keloptocrats do not stop their lucrative business. Last January, during the blackout, the mining operations of “legal” miners were suspended for 2 weeks. This time around banking transactions for cryptocurrency exchangers were to be banned by the Central Bank, but Islamic Republic President ordered the Central Bank not to block any exchanger transaction! Another proof that Islamic Republic officials at the highest level are involved in the operations to circumvent the US sanctions.

The decentralized nature of cryptocurrencies help the Islamic Republic to bypass the sanctions and import whatever it needs. The regime’s mafia is so intertwined that everybody at a position gets a piece of the action, including Judiciary, Rouhani’s administration, police, etc. Ordinary citizens know “who are the illegal miners,” but it is beyond their ability to do anything about it. When Tavanir agents, a governmental organization, get shot, what else is expected from others?

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