News outlet Atlantic Council has reported that Iranians are venturing into Bitcoin (BTC) mining due to economic difficulties caused by the United States sanctions. Surprisingly, Iranians are churning out profits despite the recent crypto market crash and the weak Iranian rial caused by the US sanctions.
Atlantic Council has published the story of 26-year-old Iranian Ali Hosseini and his cousin Pedram Ghasemi who bought a Bitcoin mining hardware Antminer S9 two months ago for $526. At that time, Bitcoin was trading at about $6,500.
Even though the US dollar has strengthened to record high of 190,000 against the rial and Bitcoin was steadily declining, the brothers have disclosed that they are yet to see any loses due to relatively low energy cost in the country.
Iran tops the list of nations with huge energy subsidies, which accounts for nearly 10.4% of the country’s GDP. Along with oil prices, subsidies have increased considerably this year.
Furthermore, the brothers have pointed out that the “US dollar must drop below 110,000 rials and Bitcoin must be down to $2,000 for [them] to really lose.” In stark contrast from other miners who are closing down their crypto mining business and selling their hardware, Hosseini is planning to invest in more mining hardware, while forecasting that crypto will eventually replace fiat money.
Even though crypto mining was granted a legal status in early September, trading cryptocurrencies is still deemed to be illegal, as the central bank of Iran has prohibited domestic banks from dealing with crypto earlier this year.
According to a report published by Guardian, some Iranian students who are getting educated in the United Kingdom are using crypto to avoid US sanctions. Due to the prevailing currency restrictions, some students state that they are unable to receive money from their home in order to pay for tuition. As a result they are facing the risk of being suspended from courses.
In an attempt to reinstate economic stability in the country, the Iranian government is exploring the launch of its own state-backed cryptocurrency. Back in August, Iran’s National Cyberspace Center disclosed that the draft of the government-backed crypto project was ready, based on the instructions from President of Iran Hassan Rouhani.
