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Iran’s crypto mining landscape is marked by widespread illegal operations as individuals, schools, and mosques exploit subsidized electricity to mine Bitcoin, complicating efforts to quantify the nation’s BTC holdings.
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Despite official licenses issued since 2019, the majority of mining activity remains underground, driven by high electricity costs and sanctions, making Iran a significant yet opaque player in the global Bitcoin network.
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According to COINOTAG sources, estimates of Iran’s total mined Bitcoin vary widely, with figures ranging from 60,000 to 200,000 BTC, highlighting the challenges in tracking illicit mining operations and their economic impact.
Explore how Iran’s underground Bitcoin mining thrives amid sanctions and high electricity costs, with estimates of holdings ranging from 60,000 to 200,000 BTC.
Underground Bitcoin Mining in Iran: A Response to Sanctions and Inflation
Iran’s crypto mining sector has evolved as a direct response to international sanctions and a depreciating local currency. Since 2019, the government has issued legal permits for mining, yet the majority of activity occurs outside the regulatory framework. Illegal mining operations—often run by individuals, educational institutions, and religious sites benefiting from subsidized electricity—have proliferated, making it difficult to accurately assess Iran’s Bitcoin production. The University of Cambridge’s Center for Alternative Finance noted a sharp decline in Iran’s share of Bitcoin’s global hashrate from 7.5% in March 2021 to just 0.12% in January 2022, reflecting the volatility and clandestine nature of the sector.
Estimating Iran’s Bitcoin Holdings Amid Regulatory Challenges
Experts provide divergent estimates of Iran’s total Bitcoin mined. Andrew Scott Easton, CEO of Masterminded, suggests approximately 60,000 BTC have been mined historically, equating to around $6.4 billion at current prices. Conversely, Kent Halliburton of Sazmining estimates a range between 100,000 and 200,000 BTC since 2018, potentially worth up to $21.4 billion. These discrepancies underscore the opacity caused by widespread illicit mining. Compliance researcher Rajat Ahlawat emphasizes that the underground nature of mining, driven by prohibitive electricity tariffs for licensed miners, obscures accurate measurement and tracking.
Electricity Costs and the Shift to Illegal Mining Operations
Licensed mining farms in Iran face high electricity tariffs, often exceeding those paid by energy-intensive industries such as iron and steel. This economic pressure incentivizes miners to operate illegally, leveraging free or subsidized electricity available to mosques, schools, and government-linked entities. Iran’s state electricity company, Tavanir, estimated around 700,000 illegal mining rigs were active in early 2025, placing significant strain on the national grid and contributing to frequent power outages. To combat this, authorities have implemented bounty programs to identify unlawful mining operations, yet enforcement remains challenging.
Government Involvement and Strategic Mining Locations
The Islamic Revolutionary Guard Corps (IRGC) is believed to be a major actor in Iran’s crypto mining ecosystem, operating covertly to maximize Bitcoin production while evading sanctions. Although speculation arose following a U.S. strike on the Fordow nuclear site—located in a mountain with robust electrical infrastructure—there is no concrete evidence linking the facility to mining activities. Industry analysts caution against overinterpreting short-term fluctuations in Bitcoin hashrate, noting its inherent volatility. Nonetheless, the IRGC’s involvement highlights the strategic importance of crypto mining as a tool for circumventing economic restrictions.
Public Engagement with Cryptocurrency Amid Economic Uncertainty
Crypto mining and trading have become widespread among the Iranian population as a hedge against hyperinflation, which currently exceeds 38%. Social media activity reveals a vibrant community of at-home miners, with some entrepreneurs marketing soundproof mining equipment to mitigate noise concerns. However, not all crypto ventures have succeeded; for instance, the Telegram-based game Hamster Kombat attracted millions of Iranian users but ultimately failed to deliver meaningful financial returns, illustrating the risks associated with speculative crypto projects.
Impact on Iran’s Energy Infrastructure and Policy Responses
The surge in illegal mining has placed unprecedented demand on Iran’s electricity grid, prompting government efforts to regulate and control the sector. While licensed miners are required to sell their Bitcoin directly to the central bank, underground miners retain their earnings, further complicating regulatory oversight. The government’s dual approach—issuing licenses while cracking down on illicit operations—reflects the tension between economic necessity and energy management in a sanctioned economy.
Conclusion
Iran’s Bitcoin mining industry remains a complex and largely opaque sector shaped by economic sanctions, inflation, and energy policy. The predominance of illegal mining operations, fueled by subsidized electricity in institutions like mosques and schools, obscures the true scale of Iran’s Bitcoin holdings. While estimates vary widely, it is clear that crypto mining serves as both a financial lifeline for many Iranians and a strategic tool for the government. As global scrutiny intensifies, understanding the dynamics of Iran’s crypto mining landscape will be essential for policymakers and investors alike.
