Sanctioned Nations Turn to Bitcoin Mining as a Financial Lifeline, Says Hive Co-Founder

Countries under U.S. sanctions are covertly engaging in Bitcoin mining to gain access to financial resources, according to Frank Holmes, co-founder of Hive Digital, during a podcast on TheStreet.

He pointed out that the 15% decrease in the hash rate and mining difficulty of Bitcoin in June was linked to airstrikes on Iran by Israel and the United States. “Why? Because Iranian military forces have been effectively mining Bitcoin illegally to secure U.S. dollars, and the power plants have suffered as a result,” he concluded.

Holmes emphasized that this situation is not limited to Iran alone. He noted that the governments of such nations often do not adopt crypto-friendly policies. “They exhaust all options, and when they can’t acquire dollars, they turn to Bitcoin mining,” he stressed.

In response to a question from host Scott Melker regarding how many jurisdictions may be involved in this secretive activity, the executive chairman of Hive replied, “This will eventually come to light and will become a significant source of income for what some call the ‘Axis of Evil.’ There’s no doubt about it.”

According to Hashrate Index, by early 2025, the U.S. accounted for 38% of Bitcoin’s hash rate, while Russia had a 16% share, and Iran’s participation was between 1-2%.

Melker also inquired about Hive’s strategy for retaining mined coins. Holmes confirmed that the company adheres to this strategy but is not averse to selling its digital assets to expand its operations. For instance, some of their reserves were liquidated to acquire mining capabilities from Bitfarms in Paraguay.

Holmes noted that this decision led to an increase in coin production, with Hive’s daily revenue estimated at about $760,000, which is expected to rise to $3 million as the hash rate grows.

As per BitcoinTreasuries, the company currently holds 2,201 BTC.

Additionally, JPMorgan analysts recently highlighted that July was a successful month for publicly traded Bitcoin miners, with their revenue per EH/s reaching its highest level since the last halving event.