U.S. Senators Elizabeth Warren and Angus King have raised alarms about potential national security risks stemming from Iran's use of cryptocurrency mining. They worry that Iran may be exploiting digital assets to circumvent U.S. sanctions, potentially financing groups that pose threats to U.S. security. The senators are urging the Biden administration to address the escalating ties between the Iranian government and local crypto miners.

According to the senators, Iran has been leveraging cryptocurrency mining to evade sanctions and support activities against U.S. interests, such as the recent attack on Israel. They allege that the Iranian military has used crypto to fund well-known terrorist organizations, including Hezbollah, underscoring the direct dangers to national security.

The letter serves as a plea to U.S. officials to take swift action to prevent Iran from misusing digital assets for illegal purposes. The senators are requesting information on the profits generated by crypto miners in Iran and their potential involvement in money laundering schemes.

Iran's Reliance on Cryptomining

Iran has emerged as a key hub for Bitcoin mining, with reports suggesting that its central bank channels cryptocurrency to bolster the country's economy. Nevertheless, the surge in crypto mining activities in Iran is placing strain on the nation's power grid, leading to intermittent halts in mining operations due to concerns over energy consumption. Moreover, the senators have highlighted Iran's reputation for crypto laundering and alleged ties to ransomware incidents, heightening concerns about the country's exploitation of digital currencies to evade sanctions.

In their letter, Warren and King noted, “Cryptomining has become a significant industry in Iran, putting immense pressure on the country’s energy grid, prompting the Iranian government to temporarily halt crypto mining following accusations of widespread power outages.”

Warren and King have tasked senior military and financial officials with outlining steps taken to address national security risks associated with Iran's crypto mining ventures. The letter coincides with the Senate Armed Services Committee's discussions on global threats, underscoring the need for decisive action regarding Iran's growing utilization of cryptocurrency. As Iran grapples with economic sanctions, its increasing reliance on revenue from crypto mining further complicates the intersection of digital assets and international security concerns.