As blackouts and police raids roil the upstart Iranian Bitcoin mining industry, a friction match betwixt a permissionless currency and a country throttled by aggrandizement that one time seemed like a perfect fit is now being called into question.

As Cointelegraph has previously reported, Iran joins Pakistan as a cryptocurrency superpower in the Middle Due east, owing in part due to cheap, heavily subsidized electricity prices, as well every bit a boost in activity following an blessing of Bitcoin mining every bit an "industrial activity" for power plants in 2020. It's been estimated that there are well over 1000 legal entities currently engaged in mining activities.

However, the short history of cryptocurrency mining in the country has not always been a rosy one. Authorities have moved to shut downwards at least a chiliad illegal farms in recent months, and Bitcoin spot prices accept been mispriced at time relative to the rest of the world due to high demand equally investors flee the rapidly inflating rial.

Now, another source of friction has emerged as the country is plunged into frequent ability blackouts in large population centers.

On January 16th, multiple outlets reported that Iran suffered blackouts throughout almost of the country. Social media reports accept indicated that power has been spotty both before and after the outage on the 16th, however, with multiple cities experiencing blackouts all through the by two weeks.

Authorities take been quick to blame Bitcoin mining for the outages and have publicized police raids on illegal mining operations, but some experts call back the authorities is only searching for excuses for a long-decaying power filigree.

In an interview with the Associated Press on Thursday, former deputy caput of Iran'south Department of Environment Kaveh Madani said that Bitcoin was an "piece of cake victim," and that "decades" of administrative mismanagement are a more than likely root cause.

Moreover, while retail mining may currently exist interim as a scapegoat for the government, information technology'south articulate that government aren't entirely turning their backs on cryptocurrency. As recently as last month Bitcoin was used to facilitate import payments from Venezuela.

While the relationship may be rocky at the moment, this certainly doesn't appear to be the end of Bitcoin in Iran.