Cryptocurrency mining, a process using banks of high-powered computers, has led to electricity shortages and cuts in both urban and rural areas, according to reports in recent days from Iranian media, social media users and some energy industry officials.

Electricity cuts in the capital Tehran have become a daily occurrence in the past two weeks, with the police expressing concern Tuesday over its possible impact on crime.

Mohammad-Taghi Karrubi, a reformist activist, in a tweet on Tuesday said bitcoin farming in Iran could create billions of dollars, far more than the revenue from exported oil under sanctions. “Massive income is earned by some but people’s share from it is air pollution and power cuts,” he wrote.

Bitcoin mining, which has a high carbon footprint, is carried out in high-tech data centers making huge demands on the electricity grid due to the many computers required to process and verify transactions before they are recorded on the cryptocurrency ‘blockchain.’

Masoud Nouri, a veteran Iranian journalist, in a tweet on Monday said there were rumors that Chinese investors and a “military body,” presumably the Revolutionary Guards, had established a joint 175-megawatt bitcoin mine at Rafsanjan Special Economic Zone (RSEZ) in Kerman Province, which benefitted from cheap electricity tariffs offered to those mining cryptocurrency. Nouri demanded an explanation from the Ministry of Energy.

Insufficient electricity supplies have led the government to burn dirty, heavy oil products such as Mazut for power generation that have blanketed major cities in a an unhealthy fog of smug.

Tejarat News on January 10 quoted Mohammad-Reza Sharafi, a member of Iran Blockchain Association, pointing out that Iran’s special economic zones also offered tax exemptions, boosting the profits possible in crypto-mining. Tejarat said it awaited a response to questions it has asked of Iran-China Industrial Development Group, a Kerman-based cryptocurrency mining farm, about its activities in Rafsanjan Special Economic Zone.

Mostafa Rajabi-Mashhadi, spokesman of Iranian Electricity Industry Union, said on Friday in an interview with the news agency IRNA that bitcoin miners were using more than 300 megawatts of electricity “illegally” every day to mine cryptocurrencies, including bitcoins, which currently trade at more than $30,000.

Rajabi-Mashhadi promised that “illegal cryptocurrency mining centers” would be identified and fined for damage done to the power grid.  Each bitcoin transaction uses around 657.39 kWh of electricity, the equivalent of 59 days of electricity for an average British household, the Daily Telegraph reported on March 1, 2020.