The Central Bank of Iran (CBI) will allow banks, currency exchanges, and licensed miners to pay for imports using cryptocurrencies.
According to a report from the Iranian site Financial Tribune, The CBI has issued a notification to banks and licensed exchanges about the new regulatory framework for crypto payments. The government will soon pass a bill to clarify the regulatory whether in the country.
Crypto as a Tool to Avoid U.S. Sanctions
The tension between the U.S. and Iran exacerbated through the years, and the U.S. Treasury Department has somewhat crippled Iran’s economy, heavily depending on international trades like gas and electricity.
In this regard, Iran has been exploring the benefits of cryptocurrencies and how they can help the country bypass sanctions. As reported, Iran became the world’s first to constitute Bitcoin as a medium of exchange on October 29, 2020. By January 2021, the government issued over 1,000 licenses for crypto mining equipment, even offering power plants to miners.
Crypto mining is legal in Iran, but every miner needs a license from the Ministry of Industry, Mine, and Trade to operate legally. Licensed miners must sell mined BTC to Iran’s Central bank through the provided channels by the entity.
Iran’s history with cryptocurrencies was turbulent at first, and mining crypto was illegal until 2019. After reporting several blackouts across the country, local authorities seized 45,000 BTC mining rigs in January this year, blaming crypto farms for their “intensive electricity use.“
Crypto in Countries With Hyperinflation
Iran is not the first country to use crypto as an alternative to avoid U.S. sanctions although. As reported by CryptoPotato, Venezuela is one of the most active countries in this regard. Venezuelans usually trade BTC through LocalBitcoin —a P2P marketplace where buyers and sellers offer rates and payment methods.
Cryptocurrencies and stablecoins are also becoming an alternative for many savers and investors in Argentina, which is now experiencing a severe financial crisis. Like Venezuelans, Argentinians are now flocking to crypto exchanges and P2P marketplaces to buy and sell crypto assets and to protect themselves from currency inflation.