Cryptocurrency might help Iran bypass sanctions

Iran placed its first import order this week worth $10 million using cryptocurrency, which could help Tehran evade US sanctions.

“By using cryptocurrency Iran could sort of bypass the global financial system, which is obviously dominated by US dollars, and could also circumvent the sanctions imposed on Iran that it’s really suffering from,” Pia Steckelbach, i24NEWS correspondent explained.

She added that the sanctions are taking a heavy toll on the country, with inflation reaching record highs. According to the reporter, the timing of the order is significant. 

“Iran is also amidst of nuclear talks in Vienna, so Iran might actually be signaling to the West that if an agreement is not reached ,and if sanctioned are not lifted, Iran is able to find other ways and find its way around these sanctions in order to import foreign goods,” Steckelbach said. 

Earlier on Tuesday, Iran’s Trade Ministry announced that as soon as September, Tehran wants to use cryptocurrency to trade with foreign countries.

“By the end of September, the use of cryptocurrencies and smart contracts will be widely used in foreign trade with target countries,” a ministry’s official said on Twitter.

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Iran is known as a hotspot for mining, which Tehran legalized in 2019. Around 4.5 percent of the global bitcoin mining is done in the country.  

Cryptocurrency critics have previously pointed out that digital assets are not supervised and can be used for criminal transactions or for surpassing sanctions. Iran didn’t specify which cryptocurrency was used for its first import order.

The US imposed an almost total economic embargo on Iran, including a ban on all imports including those from the country’s oil, banking and shipping sectors. The 2015 nuclear deal promised Tehran the lifting of sanctions in exchange for the country limiting its nuclear program. However, the talks on the agreement have been stalled with the recent round of negotiations in Vienna leaving some parties optimistic about a possible breakthrough. 

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