The economic downturn in Iran makes way for crypto adoption

The economic downturn in Iran makes way for crypto adoption
Written by:
Ali Raza
24th September, 10:05
  • Iran continues to show the willingness to switch to Bitcoin as its economy continues to deteriorate.
  • While banks still can't work with digital currencies, there are merchants who accept it, and locals use it.
  • Even the elderly are open to trying it out, as they continue to lose money due to the rial's price drops.

Iran is ripe for Bitcoin adoption, as the leading cryptocurrency is becoming increasingly relevant due to the US sanctions and the consequences of the COVID-19 pandemic. So much so, in fact, that even the elderly citizens of the country are losing confidence in the nation’s fiat currency, the rial, and are looking for an alternative.

Iran is becoming more and more open to the idea of crypto

Bitcoin’s decentralization and independence from government control makes it an ideal option for those who wish to both, earn, as well as keep the value of their existing funds.

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One of the country’s biggest bitcoiners, Zahra Amini, stressed the value that Bitcoin can bring to the locals by joking that she would not mind stopping people in the street just to tell them about Bitcoin. Meanwhile, other Bitcoin supporters claim that holding rial can only lead to losing money on a daily basis.

Even Iran’s government, as repressive as it is, did not ban crypto usage. Instead, it recognized BTC mining as a real, legitimate industry. However, it is trying its best to regulate it, thus risking to overdo it. Even the country’s central bank is considering creating a CBDC.

Iran is in economic trouble, but Bitcoin can help

The poor state of Iran’s economy is a result of a long deterioration, which started back in May 2018, after the US abandoned its nuclear deal with the country. The economic sanctions introduced after the deal had failed led to an ongoing recession, and the rial’s value was cut in half.

When the pandemic struck, it only further contributed to the country’s economic crash.

Bitcoin can help with both issues, allowing the country to circumvent the sanctions, and serve as a hedge against inflation. Many are already using it, including students abroad, but also locals from the Kurdish province, who can use it to pay for goods and services.

The country has done a lot to regulate mining, although exchanges are still allowed to operate without a license. However, Iran’s central bank also banned other banks from dealing with crypto, so withdrawing the funds may be a problem for the locals for a while longer.

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