Mining industry institutionalized! Iran issues final ultimatum: all mining farms must register with the government within one month.

In recent years, various economic factors in Iran, including economic sanctions from the United States, domestically cheap electricity, and the long-term devaluation of the fiat currency (renamed to Toman in May), have increased incentives for the Iranian people to invest in Bitcoin, cryptocurrency mining, and related industries. The country's regulatory stance has evolved from ambiguity to clear legislation last year. Currently in Iran, besides requiring permits, the Vice President announced on Monday that domestic miners must officially register with the government within a month.

According to a directive issued by Iran's Vice President Eshaq Jahangiri, this move aims to promote the domestic business environment, eliminate uncertainty among mining professionals regarding regulations, and increase government oversight of the mining industry to facilitate government initiatives. The key points are as follows:

• Miners are required to register their identities, mining site scales, and types of mining equipment with the Ministry of Industry, Mining, and Trade.
• Registration must be completed within one month, and the authorities will publish an official list of permits.

The announcement states:

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The Ministry of Industry, Mining, and Trade is required to announce a list of permits within one month of the regulation's implementation in the mining sector. Mining machine owners are also obligated to provide detailed information about all mining machines to the center within one month to obtain permits. In the future, mining machines will be prohibited from being placed in unlicensed mining sites.

Iran Engages in Mining as Industrial Activity

Iran continues to attract institutions or small miners to invest in the Bitcoin mining industry due to its cheap electricity. According to reports from June, as of April this year, the Bitcoin hashrate ranked by country from highest to lowest is China, the United States, Russia, Kazakhstan, Malaysia, and Iran (3.82%).

According to local media reports, in a cabinet meeting hosted by President Hassan Rouhani in July last year, the mining industry was officially recognized by the government as an industrial activity, with cryptocurrency mining viewed as an industrial activity, and participants are required to obtain the necessary permits from the Ministry of Industry, Mining and Trade.

Last year, reports indicated that the Iranian government provides approximately $1 billion in electricity subsidies annually, with partial subsidies for household electricity usage. This may be an incentive for miners to not actively apply for permits. Although over 1,000 mining permits have been issued as of January this year, there may still be small mining operations looking to further reduce their mining electricity costs.

Continuously Evolving Cryptocurrency Regulation

Most countries around the world are likely still weighing the pros and cons of cryptocurrencies, leading to regulatory uncertainty. Iran's fluctuating stance clearly illustrates the dilemma faced by authorities worldwide.

In September last year, the Iranian National Tax Administration (INTA) introduced a tax exemption similar to that provided by non-oil exporting countries to prevent capital flight, considering cryptocurrency mining as a taxable business. They announced that if Iranian cryptocurrency miners bring back their foreign earnings to Iran, they will receive attractive tax incentives.

In May this year, President Hassan Rouhani had previously clearly urged the need for a national level cryptocurrency mining policy, deeming it a particularly important development for Iran, as it could help evade the numerous long-term sanctions imposed by the United States.

Iranian parliament member Mohammad Hossein Farhangi also stated on June 4th:

Bitcoin must be taken seriously because if it can be managed, it will be a great opportunity for Iran, otherwise, it will become a business between financial and credit institutions.