IRGC’s Unlicensed Crypto Mining in Iran: How the Guard Exploits Power

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What’s really happening with crypto mining in Iran?

Iran has become one of the world’s biggest Bitcoin producers, but the story behind the numbers is anything but ordinary. While a handful of independent miners struggle to stay afloat under high electricity tariffs, a hidden army of state‑linked farms siphons off cheap or free power to generate crypto wealth for the regime. This phenomenon is best described as IRGC cryptocurrency mining - a network of unlicensed operations run by the Islamic Revolutionary Guard Corps (IRGC) and entities directly answerable to Supreme Leader Ali Khamenei.

Islamic Revolutionary Guard Corps (IRGC) is a powerful branch of Iran’s armed forces that also controls vast economic assets, including mining operations, energy facilities, and charitable foundations known as bonyads. Its involvement in crypto mining turned from a novelty in 2017 to a full‑blown “crypto cartel” by 2020.

How the IRGC entered the mining game

The push began when international sanctions choked Iran’s dollar channels. Deprived of foreign exchange, the regime looked for a way to generate hard cash without relying on banks. Crypto offered exactly that: borderless, pseudonymous, and free from Western financial oversight.

By 2019 the Ministry of Industry, Mines and Trade announced a licensing system for miners, but the rules were deliberately skewed. Licensed operations paid full electricity rates and were forced to sell all coins to the Central Bank of Iran. The IRGC saw an opportunity to bypass these constraints by creating ‘unlicensed’ farms that operated under the radar of civilian regulators.

Key steps in the IRGC’s entry:

Forming joint ventures with Chinese investors eager for cheap power.
Securing land in special economic zones and military bases where civilian oversight is minimal.
Leveraging political connections to obtain subsidised electricity or even free power from the national grid.

Scale and infrastructure of the mining farms

Estimates suggest Iran houses around 180,000 mining devices. Roughly 100,000 of those are under direct IRGC control, either through state‑run companies or the massive charitable trust Astan Quds Razavi, which functions as a bonyad under the Supreme Leader’s supervision.

A flagship example is the 175‑megawatt Bitcoin farm near Rafsanjan, Kerman Province. The site is officially a joint venture, but most of the equipment is owned by an IRGC‑linked firm, while Chinese partners provide the latest ASIC miners.

These farms consist of rows of specialised computer servers (ASIC miners) that can each consume 1.5-3 kW. At full capacity, a single 1‑MW block can power roughly 300 homes, meaning the Rafsanjan farm alone can deprive an entire city of electricity for days.

Why electricity matters: the energy theft

Iran’s power grid is already under strain, with frequent blackouts across Tehran and industrial hubs. The IRGC’s ability to tap into the grid without paying tariffs magnifies the crisis.

In 2022 the parliament quietly passed a law allowing the military to set up private power plants and transmission lines. This gave the IRGC legal cover to divert electricity meant for civilians directly to its mining operations.

Consequences are stark:

Average household electricity availability dropped from 10‑12 hours per day to 4‑5 hours in many provinces.
Industrial output fell by up to 15 % in regions where large farms operate.
National energy losses rose to an estimated 12 % of total generation, largely attributed to unmetered consumption.

A large Bitcoin mining farm under bright sun, with power lines leading to a city experiencing blackouts.

Legal gray zone: licensed vs unlicensed mining

While the government recognised crypto mining as a legal activity in 2019, the licensing regime was designed to funnel profits to the state. Licensed miners faced high tariffs (up to 0.15 USD/kWh) and were compelled to sell any mined coins at the official rate set by the Central Bank of Iran (Iranian Central Bank (CBI)), often well below market value.

Unlicensed operations, in contrast, enjoyed near‑free power and could sell directly on the open market via offshore exchanges, netting billions of dollars in Bitcoin earnings. The dual system created a two‑tiered industry: a small, struggling legal sector and a massive, well‑protected illicit arm.

Sanctions evasion and geopolitical impact

Cryptocurrency has become a lifeline for Iran to sidestep sanctions. Blockchain analytics firms consistently rank Iran among the top Bitcoin producers, and several wallets traced back to IRGC‑linked entities have been cited by the U.S. Treasury and Israeli intelligence as funding channels for proxy groups in the region.

Two features make crypto ideal for sanctions evasion:

Direct peer‑to‑peer transfers eliminate the need for intermediary banks that could freeze assets.
Pseudonymous wallets obscure the ultimate beneficiary, complicating enforcement.

By converting mined Bitcoin into cash via offshore mixers, the IRGC can fund its overseas operations without triggering the usual financial watchdogs.

Impact on ordinary Iranians

Energy Minister Ali Abadi - a former IRGC commander turned university president and later CEO of the energy ministry - acknowledged the crisis, likening illegal mining to “putting a hand in others’ pockets.” His own background raises questions about the political will to curb the practice.

Every day Iranians face:

Extended blackouts lasting up to 12 hours in summer months.
Higher electricity bills for those who remain connected, as the grid compensates for stolen power.
Limited access to legal crypto channels, forcing many to rely on VPNs and platforms like Nobitex, a domestic exchange tightly monitored by the CBI.

Many citizens still turn to crypto as a hedge against inflation, but the state’s monopoly makes it difficult to reap the benefits without falling into the same illegal traps.

A scale balancing a Bitcoin coin and a light bulb, with new farms and a sunrise in the background.

Recent regulatory moves and future outlook

On 27 December 2024 the CBI launched a system that blocked all direct fiat‑to‑crypto conversions on Iranian websites. By January 2025 the bank began selectively unblocking certain exchanges, but only after they integrated a government‑run API that captures full user data. This signals a shift from outright bans to tight surveillance.

Meanwhile, the IRGC continues to expand its mining footprint. Satellite imagery from 2025 shows at least three new farms, each exceeding 100 MW, located near military installations in the provinces of Khuzestan and Golestan.

Potential future scenarios:

Escalated crackdown: International pressure could force Tehran to shut down unlicensed farms, but given the IRGC’s control over the power grid, enforcement would be limited.
Further entrenchment: The regime may double down, investing in renewable‑energy‑backed farms to reduce reliance on the overstretched grid.
Negotiated reform: A compromise could involve licensing more miners at reduced tariffs while keeping a small state‑run quota for revenue.

For now, the IRGC’s crypto empire remains a powerful, opaque player in Iran’s economy.

Key takeaways

The IRGC runs the majority of Iran’s high‑power crypto farms, bypassing civilian regulation.
Cheap or free electricity is the core advantage, leading to chronic blackouts for citizens.
Crypto mining serves as a major sanctions‑evasion tool, financing regional activities.
Recent CBI measures aim to monitor rather than eliminate crypto, indicating the state’s desire to retain control.

Frequently Asked Questions

Why does the IRGC focus on Bitcoin instead of other cryptocurrencies?

Bitcoin remains the most liquid and widely accepted digital asset. Its market depth and global recognition make it the preferred choice for converting mined energy into cash that can cross borders without attracting the same level of scrutiny as newer, less‑traded tokens.

How much electricity does an IRGC‑run mining farm consume?

A typical large‑scale farm operates between 100 MW and 200 MW, roughly equivalent to the electricity needs of a small city. The Rafsanjan facility alone is estimated at 175 MW.

Can ordinary Iranians legally mine cryptocurrency?

Yes, but they must obtain a licence from the Ministry of Industry, Mines and Trade, pay high electricity tariffs, and sell any mined coins to the Central Bank at the official rate, which often makes the venture unprofitable.

What international actions target IRGC crypto activities?

The U.S. Treasury and Israeli intelligence have listed several IRGC‑linked Bitcoin wallets for sanctions, freezing any assets that pass through U.S.‑controlled financial channels.

Will Iran’s energy crisis improve if crypto mining is halted?

Reducing the IRGC’s power consumption would free up a significant portion of the grid, likely cutting blackout durations by 30‑40 %. However, without broader reforms to the electricity sector, other systemic issues would remain.

25 Comments

Erik Shear
October 23, 2025 AT 09:21

IRGC mining is pure greed.
Tom Glynn
October 23, 2025 AT 10:11

Seeing the IRGC hijack cheap electricity for Bitcoin feels like watching a massive beast feasting on a dying ecosystem. It's a stark reminder that power, both political and electrical, can be weaponized in the digital age. While sanctions tighten, the regime finds loopholes that keep the wheels turning, even if it costs ordinary citizens their lights. The irony is palpable: a nation battling energy shortages finances its own crypto empire on the back of those very shortages. 🌐💡 This paradox fuels a deeper conversation about sovereignty and blockchain's role in geopolitics. It's both a warning and a case study for anyone studying modern statecraft.
Johanna Hegewald
October 23, 2025 AT 11:01

The IRGC has built huge mining farms that use almost free power from the grid. Licensed miners have to pay high tariffs and sell their coins at low rates, making it almost impossible to profit. This creates a two‑tier system where the state‑linked farms thrive while small operators struggle. The result is frequent blackouts for everyday Iranians. In short, the power grab hurts the public.
Benjamin Debrick
October 23, 2025 AT 11:51

One must, of course, acknowledge the intricate tapestry of geopolitical maneuvering, economic exigency, and technological opportunism that underlies the Islamic Revolutionary Guard Corps' foray into cryptocurrency mining; indeed, it is a phenomenon replete with paradoxical undertones, wherein the very apparatus of state‑controlled energy is subverted to generate digital wealth, unshackled from conventional financial oversight. Moreover, the juxtaposition of sanctioned austerity against an unabashed pursuit of blockchain assets reveals a dissonance that is, frankly, both fascinating and disquieting. The sanctioned regime, leveraging clandestine partnerships with Chinese ASIC manufacturers, thereby circumvents domestic tariff structures, rendering the operation economically quasi‑viable, if not outright profitable. Consequently, the civilian populace-already burdened by intermittent electricity-finds itself further disenfranchised, a collateral casualty of the state’s crypto ambitions. Ultimately, this dual‑track system epitomizes an asymmetrical approach to resource allocation, one that warrants rigorous scrutiny from both economists and policy analysts alike.
johnny garcia
October 23, 2025 AT 12:41

From a policy perspective, the IRGC's exploitation of subsidized electricity constitutes a clear breach of equitable resource distribution, undermining national energy security. The state's tacit endorsement of such practices, manifested through legislative adjustments, signals an institutional complicity that cannot be ignored. 📊 📈 Furthermore, the resultant fiscal leakage-estimated in the billions of dollars-directly impacts public welfare programs, exacerbating socioeconomic disparities. It is incumbent upon regulatory bodies to institute transparent oversight mechanisms, lest the covert crypto empire continue to erode public trust. In essence, the current trajectory is unsustainable and demands immediate corrective action.
Andrew Smith
October 23, 2025 AT 13:31

We can't just sit back while the Guard drains the grid; it's time to rally the legit miners and push for fair tariffs. If the community bands together, we can pressure the ministry to enforce the licensing rules more stringently. The power users deserve their electricity back, and the miners deserve a level playing field. Let's make some noise and demand accountability now.
Ryan Comers
October 23, 2025 AT 14:21

Enough is enough! The IRGC is stealing our power, using it to line foreign pockets while our families sit in the dark! 🇮🇷💢 This is more than a crypto scam; it's an affront to Iranian pride and sovereignty. We must expose every hidden farm and cut off their energy supply before it destroys the nation.
Prerna Sahrawat
October 23, 2025 AT 15:11

It is incumbent upon any discerning analyst to recognize that the IRGC's foray into the realm of cryptocurrency mining represents not merely an economic venture but a profound strategic recalibration of power dynamics within the Iranian state apparatus; the sheer magnitude of the energy siphoned away from civilian grids is, in its own right, a testament to the lethal efficiency with which militarized bureaucracies can repurpose national infrastructure for self‑servicing enrichment. First, the confluence of international sanctions and domestic energy scarcity created an environment ripe for exploitation, wherein the Guard, unfettered by the ordinary licensing regime, could procure electricity at rates that border on the nominal, thereby achieving a cost advantage unparalleled in the global mining sector. Second, the deployment of Chinese‑sourced ASICs, coupled with the utilization of vast tracts of land in economic zones shielded from civilian oversight, underscores a calculated approach to scaling operations beyond the reach of conventional regulatory lenses. Moreover, the clandestine nature of these farms ensures that the data pertaining to power consumption remains obfuscated, rendering any audit attempts effectively moot. The resultant blackouts, which have plagued urban centers for months on end, serve as a stark externality of this internal appropriation, a symptom that is both predictable and preventable. The social ramifications extend further; families are forced to ration electricity, businesses curtail production, and the overall national productivity metric experiences a measurable dip that reverberates through GDP calculations. Meanwhile, the illicit profits, channeled through offshore mixers, feed directly into the Guard's broader geopolitical agenda, financing proxy operations that destabilize neighboring regions. This creates a feedback loop wherein the financial might derived from digital assets perpetuates further militaristic initiatives, thereby entangling economic and security objectives in a self‑reinforcing cycle. It is also noteworthy that the Ministry of Energy, under former IRGC leadership, has instituted legislative loopholes that legitimize the construction of private power plants, effectively granting the Guard a veneer of legality. The overarching narrative, thus, is one of systematic subversion: a state apparatus that, while professing to safeguard its citizenry, systematically undermines their welfare for the sake of strategic financial autonomy. In the broader context of global crypto governance, Iran's scenario embodies a cautionary tale, illustrating how sovereign actors can weaponize blockchain technology to circumvent conventional financial sanctions. To confront this, a coordinated international effort, encompassing sanctions on the specific hardware supply chain and targeted financial restrictions, is imperative. Ultimately, the IRGC's crypto empire stands as a monument to the perils of unchecked state power intersecting with emerging technologies, and it is incumbent upon scholars, policymakers, and civil society to deconstruct and dismantle this edifice before it expands further.
Joy Garcia
October 23, 2025 AT 16:01

Some say the entire crypto surge is just a smokescreen, a way for hidden elites to move money under the radar. The IRGC might be just one piece of a larger puzzle, where global powers pull strings behind the scenes. It's unsettling to think that our energy woes could be part of a grander, secretive financial game. Yet, the evidence keeps stacking up, showing a pattern of concealed wealth flows. We ought to stay vigilant.
mike ballard
October 23, 2025 AT 16:51

From a tech‑ops standpoint, the Guard's mining infrastructure is optimized for high‑density hash rates, leveraging tier‑1 ASICs and low‑latency networking gear. The power draw aligns with a 1.5‑3 kW per unit spec, which, when aggregated, translates into megawatt‑scale grid absorption. This kind of load profile is atypical for civilian utilities, prompting a need for dynamic load balancing algorithms. The clandestine nature of the farms also means minimal telemetry data is exposed to the grid operator. 🤖📡
Molly van der Schee
October 23, 2025 AT 17:41

I totally get where you're coming from-seeing the power struggle through a crypto lens really highlights the human cost. It's heartbreaking how everyday people lose lights while the elite chase digital gold. Your take on sovereignty feels spot on; the digital age amplifies these old power games.
john price
October 23, 2025 AT 18:31

Man this is like, sooo over the top. I mean the Guard just pulling power like it's free, wtf? It’s crazy.
Ty Hoffer Houston
October 23, 2025 AT 19:21

Prerna, your analysis is impressively thorough, and you’ve mapped out the strategic layers with precision. The linkage between sanctions evasion and energy diversion is especially compelling. It underscores how intertwined geopolitics and blockchain have become.
Ryan Steck
October 23, 2025 AT 20:11

The whole "hidden elites" narrative fits the pattern we've seen with backroom deals and shadow finance. Energy shortages are rarely natural; they're often engineered to funnel cash to covert actors. When you strip away the official story, the conspiracy becomes almost self‑evident. The Guard's crypto ops are a perfect example of that.
James Williams, III
October 23, 2025 AT 21:01

You've nailed the two‑tier problem in a clear way. The disparity in tariffs really does push the small guys out of the market. It’s a shame the system is stacked like that.
Lindsey Bird
October 23, 2025 AT 21:51

What a scandal!
Katheline Coleman
October 23, 2025 AT 22:41

While the informal tone captures frustration, the underlying issue demands a more measured discourse. The appropriation of state resources for private gain erodes public trust, and that cannot be dismissed lightly. A comprehensive audit of electricity consumption across all sectors would be a prudent first step. Moreover, transparent reporting mechanisms should be instituted to prevent future abuses.
Amy Kember
October 23, 2025 AT 23:31

The tech specs you mention illustrate just how sophisticated these farms have become. It's surprising that such high‑performance gear can be hidden behind the national grid. This raises questions about regulatory blind spots and the need for tighter monitoring of power usage trends.
Evan Holmes
October 24, 2025 AT 00:21

Honestly, it's just another example of bureaucratic nonsense. Not impressed.
BRIAN NDUNG'U
October 24, 2025 AT 01:11

Appreciate the empathy, Molly. It’s essential to keep the human side in focus when discussing policy impacts.
Donnie Bolena
October 24, 2025 AT 02:01

Indeed, the patterns you outline suggest systemic exploitation; however; we must also consider the macroeconomic pressures that drive such behavior; otherwise, we risk oversimplifying a complex issue.
Elizabeth Chatwood
October 24, 2025 AT 02:51

Nice points Ty But the real problem is the lack of enforceable rules
Tom Grimes
October 24, 2025 AT 03:41

Reading Prerna's deep dive makes me think about the everyday families feeling the pinch when the lights flicker. The sheer scale of megawatt‑level consumption by these farms translates into literal outages for neighborhoods. When a household loses power, it’s more than inconvenience; it can affect medical equipment, schoolwork, and even small businesses that rely on steady electricity. The Guard’s access to cheap power therefore directly translates into economic stress for ordinary citizens. Moreover, the shadowy nature of these operations means that the public cannot hold anyone accountable; there’s no transparency in where the profits go and how the losses are distributed. This asymmetry fuels resentment and can destabilize social trust in institutions. On top of that, the environmental impact of running massive mining rigs on an already strained grid cannot be ignored. While the global crypto community debates sustainability, those local consequences are already being felt in Iran. All of this underscores the need for a concerted policy response that balances technological advancement with public welfare.
del allen
October 24, 2025 AT 04:31

Wow, that really hit home 😢. The human side often gets lost in the data, but you're right-people's lives are directly affected. Thanks for shedding light on that.
Jon Miller
October 24, 2025 AT 05:21

Man, Johnny nailed it-this whole crypto hustle is like a bad movie where the villains sneak into the power plant and leave the rest of us in the dark. Can't believe it's happening right under our noses.