Bitcoin mining cripples Iran's cities

The confluence of U.S. economic sanctions, cheap electricity, and soaring Bitcoin prices was blamed for massive urban blackouts in Iran in 2021. "One mine alone in Iran was found to be using 175MW of electricity. Authorities have since closed down 1,600 mining centres and confiscated 45,000 Bitcoin machines."

This was a stunning display of the interactions between decentralized financial networks and real world infrastructure. But it also had an environmental cost. In March 2021, as the crisis came to a head, the power shortages forced plants to burn dirtier fuels "on top of a surge in auto travel during the pandemic, with a major smog problem the result, spurring a crackdown on miners. "

The broader implication here is that as computationally-intensive proof-of-work approaches to trust spread in an unregulated way seeking profitable arbitrage, urban infrastructure networks could be subject to sudden crippling surges in demand—what happens today with Bitcoin mining and the power grid could one day play out with self-driving taxis on the roads, for instance.