A significant order valued at $10 million, marking the initial step for Iran to engage in foreign trade via digital assets like cryptocurrencies. This move aims to bypass the dollar-centric global financial system and allows trade with countries similarly restricted by US sanctions, including Russia.
The agency did not reveal which specific cryptocurrency was utilized in this transaction. Officials anticipate that by the end of September, there will be a widespread adoption of cryptocurrencies and smart contracts for foreign trade with partner nations.
Importance of Cryptocurrencies in Iran
In 2021, approximately 4.5% of all Bitcoin mining took place in Iran, partly due to the country’s access to inexpensive electricity. Cryptocurrency mining could provide Iran with substantial financial gains by enabling imports and reducing the impact of sanctions. However, given the high volatility of cryptocurrencies like Bitcoin, they are currently unsuitable for large-scale transactions.
US-Iran Sanctions and Diplomatic Efforts
On Monday, the European Union proposed reviving the 2015 Iran nuclear deal following four days of indirect talks between US and Iranian officials in Vienna. Under this agreement, Iran reduced its nuclear program as part of a relief from sanctions imposed by the United States, Europe, and the UN. However, former President Donald Trump abrogated the deal in 2018, reinstating strict US sanctions, which led Iran to violate the nuclear limits set under the pact.
Global Adoption of Cryptocurrencies
El Salvador adopted Bitcoin as legal tender in 2021 despite challenges. Before this, El Zonte Bitcoin Beach had accepted Bitcoin for payments. Since then, other Latin American countries such as Argentina, Panama, and Brazil have begun exploring the regulation of digital assets.
Nevertheless, El Salvador’s economy has faced difficulties amidst a recent crypto market downturn, with financial experts from CNBC and similar sources expressing concern over the government’s investment in Bitcoin. Countries like Honduras have launched public awareness campaigns to caution citizens about the unreliability of crypto payments at present.
