Iran’s approval to use crypto for imports is known as a safe alternative to avoiding US sanctions imposed on the country’s financial and banking sectors. According to Iranian Industry, Mines and Trade Minister Reza Fatemi Amin, the regulations for using cryptocurrencies instead of USD and euro were approved by the authorities on August 28.
“All crypto-related issues, including fuel and energy supply, as well as designation and licensing, have been fully enacted,” he added.
Back earlier this month, Iran registered its first import order to be paid in crypto worth $10 million. This has been seen as an unexpected move, a first step towards allowing the country to trade through digital assets that bypass the dollar-dominated global financial system as well as to trade with other countries similarly limited by US sanctions like Russia.
By the end of September, the use of crypto and smart contracts will be widely adopted in foreign trade with target countries, Alireza Peymanpak, Iran’s Deputy Minister of Commerce, head of the Trade Promotion Organization of Iran (TPO) Alireza Peymanpak said.
In fact, Iran’s crypto adoption process is quite complicated. In 2019, Iran’s Central Bank banned crypto transactions in the country while its government still allows the use of crypto, such as Bitcoin, to pay for imports. Iran then revealed its plan to use crypto in transactions for international settlements for over a year and officially confirmed it in early 2022.
In terms of crypto mining, Iranian government approved this activity as a legal industry in 2019. Up to now, the Ministry of Industry, Mines and Trade has issued more than 1,000 licenses to cryptocurrency mining units/organizations. However, in November 2021, Iran suspended Bitcoin miners and then seized over 9000 illegal crypto mining rigs in March 2022 due to electricity shortages. A stable regulatory framework for cryptocurrencies is needed in Iran.
Moreover, the US sanctions have caused a lot of damage to the Iranian economy, weakening the national currency, that’s why cryptocurrency has become more popular in the country. It is estimated that Iran now has more than 12 million people holding crypto.
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