Iran Places First Import Order In Cryptocurrency, May Help Avoid US Sanctions

Iran made its first official import order in cryptocurrency this week, semi-official agency Tasnim reported on Tuesday, a move that could allow the Islamic Republic to bypass sanctions. American sanctions crippled the economy.

The order, valued at $10 million (about 80 crore), is the first step towards enabling the country to trade through digital assets bypassing the global financial system spent by the dollar. distribute and trade with other countries that are restricted by U.S. sanctions, such as Russia. The agency did not specify which cryptocurrency was used in the transaction.

“At the end of September, the use of electronic money and smart contract will be widely used in foreign trade with the target countries,” an official from the Ministry of Industry, Mines and Trade said on Twitter.

The United States imposed a near-total economic embargo on Iran, including a ban on all imports including those from the country’s oil, banking and shipping industries.

Tehran is one of the largest economies yet to adopt cryptocurrency technology, which was born in 2008 as a payment instrument aimed at eroding government control over finance and the economy.

Last year, a study found that 4.5% Bitcoin Mining activity is taking place in Iran, partly because of the country’s cheap electricity prices. Cryptocurrency mining can earn Iran hundreds of millions of dollars that can be used to buy imports and ease the impact of sanctions.

Cryptocurrencies like Bitcoin are highly volatile, making them impractical for large-scale payments.

The European Union on Monday said it had produced a “final” text to reinstate the 2015 Iran nuclear deal as indirect four-day talks between US and Iranian officials in Vienna.

Under the 2015 deal, Iran limited its nuclear program in return for US, EU and UN sanctions. However, former US President Donald Trump abandoned the nuclear deal in 2018 and reinstated harsh US sanctions, prompting Tehran to begin violating the agreement’s nuclear limits about a year later. .

The Central African Republic (CAR), one of the poorest countries in the world, has also accepted cryptocurrencies. It became the first African country to make bitcoin legal tender in April and last month launched its own digital currency.

El Salvador last year also accepted bitcoin as legal tender, though the project has been besieged by public skepticism amid the cryptocurrency’s falling prices.

© Thomson Reuters 2022

Cryptocurrency is an unregulated digital currency that is not a legal tender and is subject to market risk. The information provided in the article is not intended and does not constitute financial advice, trading advice or any other advice or recommendations of any kind provided or endorsed by NDTV. NDTV will not be liable for any loss arising from any investment based on any perceived recommendations, forecasts or any other information contained in the article.

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