On the same day US and Israeli forces launched strikes on Iran, something was still running inside the country that no bomb can shut down. Bitcoin mining rigs — humming in warehouses, factories, and reportedly even mosques — kept hashing away, converting subsidized Iranian electricity into digital money that no government can freeze, seize, or sanction. This is not an accident. It is policy. And it is working.
Iran’s relationship with Bitcoin mining began in the late 2010s as US sanctions following the collapse of the nuclear deal decimated the country’s access to the global financial system. Oil exports fell by 70%. The Iranian rial collapsed. Foreign currency dried up. The government needed a way to monetize its one abundant resource — cheap, subsidized energy — without going through a bank.
Bitcoin mining is essentially the conversion of electricity into money. Iran recognized this early. In 2019 the government officially legalized cryptocurrency mining, established a licensing regime, and began directing licensed miners to sell their mined Bitcoin directly to the Central Bank of Iran. The central bank then uses that Bitcoin to pay for imports — bypassing the SWIFT banking system entirely.
The economics are extraordinary. As of early 2026, Iran’s heavily subsidized electricity costs as little as $0.005 per kilowatt-hour. Mining one Bitcoin consumes roughly 2,000 to 3,000 megawatt-hours of energy. At Iranian rates, the total cost to mine a single Bitcoin comes to approximately $1,320. At a Bitcoin price of $63,000 — even after today’s war-driven drop — that is a profit margin that no legitimate business on earth can match.
Iran currently controls approximately 4.2% of the global Bitcoin hashrate, making it the fifth largest mining nation on earth behind the United States, Kazakhstan, Russia, and Canada. This is down from a peak of 7.5% in March 2021 but still represents massive industrial-scale operations.
The Islamic Revolutionary Guard Corps — the IRGC — operates approximately 700,000 mining rigs across Iran consuming around 2,000 megawatts of electricity. That means roughly every 25th Bitcoin block mined globally potentially funds IRGC operations. Elliptic estimates Iran earns hundreds of millions of dollars annually from Bitcoin mining, money that flows directly into a financial system the rest of the world has tried to cut off.
The official licensed operations are only part of the story. Former President Hassan Rouhani admitted in 2021 that approximately 85% of mining in Iran was unlicensed. Underground miners tap into residential power lines, abandoned factories, and subsidized government buildings to run rigs off the books and keep the full profit rather than selling to the central bank. Mining rigs have been confiscated from mosques. The scale of the shadow economy around Bitcoin mining in Iran is staggering.
Since 2018 Iran has mined an estimated 60,000 to 200,000 Bitcoin. The wide range reflects the difficulty of tracking underground operations. At current prices even the low end of that range represents billions of dollars in hard currency earned outside the global banking system.
Bitcoin’s core properties — the ones that make it valuable as sound money — are the same properties that make it useful for any party that wants to transact outside the traditional financial system. It is censorship resistant. Transactions cannot be blocked by any intermediary. It is borderless. There is no correspondent bank, no SWIFT code, no clearing house that can be pressured to reject a transaction. It is self-custodied. No government can freeze a wallet they don’t control the keys to.
For Iran, this is not just useful — it is existential. In December 2025, the Iranian regime’s Central Bank blocked all cryptocurrency to rial conversions on websites, trying to reassert control over the sector. The underground miners kept running. In February 2025, Iran banned all cryptocurrency advertising. The mining didn’t stop. Bitcoin’s censorship resistance is not a feature that governments can selectively apply. It works for everyone or it works for no one.
Iran is not alone in this calculation. North Korea has stolen an estimated $3 billion in cryptocurrency through hacking operations to fund its weapons program. Russia legalized cryptocurrency mining in 2024 and now allows crypto for international payments as an alternative to the dollar system. Venezuela built a state-backed mining operation in the 2010s. In 2024, sanctioned countries and entities received $15.8 billion in cryptocurrency — 39% of all illicit crypto transactions worldwide.
Bitcoin mining has not been a free lunch for Iran. The industrial-scale operations have placed enormous strain on the national electricity grid. Iran has experienced widespread blackouts across cities and provinces, leaving homes dark and factories idle for hours or days at a time. Investigations point to Bitcoin mining — particularly IRGC-linked operations consuming power at subsidized rates or no cost at all — as a major contributing factor.
The government’s response has been contradictory. It simultaneously depends on mining revenue to bypass sanctions and conducts raids to seize equipment that overloads the grid. It licenses operations while 85% of activity remains underground. It bans advertising while the Central Bank continues to use mined Bitcoin for import payments. The result is an energy black market dominated by unaccountable institutions, capital flight, and a power grid that fails its citizens.
There is a deeper irony here. The IRGC’s Bitcoin mining operations are profitable precisely because Iranian electricity is subsidized by the state — meaning ordinary Iranian citizens are effectively subsidizing the regime’s sanction-busting operation through below-market energy prices, while those same citizens sit in the dark during blackouts caused by the mining that those subsidies enabled.
Today’s US and Israeli strikes on Iran raise an immediate question for the Bitcoin network: what happens to 4.2% of global hashrate if Iranian mining infrastructure is disrupted?
When US forces struck Iranian nuclear facilities earlier this year, Bitcoin’s global hashrate dropped 15% — the sharpest decline in three years. That is a significant but survivable shock. Bitcoin’s difficulty adjustment algorithm automatically recalibrates every 2,016 blocks based on network hashrate, approximately every two weeks. If Iranian hashrate disappears suddenly, blocks temporarily slow, fees temporarily spike, and then the network adjusts and continues. North American miners — particularly in Texas — maintain significant excess capacity that can absorb the loss.
The Bitcoin network was designed to survive exactly this kind of disruption. No single country, no matter how large its mining share, can take down a decentralized network with nodes running in 100+ countries. Iran’s mining operations are a significant economic player in the Bitcoin ecosystem, but they are not a systemic threat to it.
The Iran situation is Bitcoin’s most uncomfortable proof of concept. A technology designed to separate money from state control works exactly as intended — even when the state in question is one that most of the world considers an adversary.
Bitcoin does not choose its users. It cannot. That is the entire point. The same properties that allow an Argentinian to protect their savings from hyperinflation, a Nigerian to send money to family abroad, or an American to hold wealth outside the traditional banking system also allow the IRGC to mine money outside the sanctions regime. Censorship resistance is binary. You have it or you don’t.
This makes Bitcoin politically uncomfortable in ways that will only intensify as nation-state adoption grows. The US government has built a Strategic Bitcoin Reserve and declared it will never sell its 328,000 BTC. It has also launched strikes on a country that uses Bitcoin mining to fund its military. These two facts will need to be reconciled by policymakers who are only beginning to understand what they are dealing with.
Bitcoin is not neutral. It is agnostic. And that distinction will define the next decade of geopolitics around the hardest money ever created.
The strikes today make Iran’s Bitcoin mining situation more uncertain than it has been in years. Infrastructure damage, power grid disruptions, and potential escalation could reduce Iranian hashrate further. The underground mining operations are harder to target than official facilities but are also dependent on grid stability that may be compromised.
For the Bitcoin network, the short-term impact is manageable. For the long-term geopolitical picture, Iran’s Bitcoin mining story is a preview of where this technology is heading. As more nations face sanctions, financial isolation, or dollar weaponization, the incentive to build state-level Bitcoin operations grows. The harder the world tries to isolate countries through financial systems, the more valuable a censorship-resistant financial network becomes.
Bitcoin was built to be unstoppable. Iran figured that out years before most governments did.
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