Iran placed its first official import order using cryptocurrency this week, the semi-official Tasnim news agency reported on Tuesday, a move that could allow the Islamic Republic to sidestep US sanctions that have crippled Iran. ‘economy.
The order, worth $10 million (about 80 crore), was a first step to enable the country to trade through digital assets that bypass the dollar-dominated global financial system and trade with other countries. also limited by US sanctions, like Russia. The agency did not specify which cryptocurrency was used in the transaction.
“By the end of September, the use of cryptocurrencies and smart contracts 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 imposes a near-total economic embargo on Iran, including a ban on all imports, including those from the country’s oil, banking, and shipping sectors.
Tehran is one of the largest economies yet to embrace cryptocurrency technology, which originated in 2008 as a payment tool aimed at eroding government control over finances and economies.
Last year, a study found that 4.5% of all Bitcoin mining took place in Iran, in part due to the country’s cheap electricity. Cryptocurrency mining could help Iran earn hundreds of millions of dollars that can be used to buy imports and mitigate the impact of sanctions.
Cryptocurrencies such as Bitcoin are highly volatile, making them impractical for large-scale payments.
The European Union said on Monday it had presented “final” text to revive the 2015 Iran nuclear deal as four days of indirect talks between US and Iranian officials wrapped up in Vienna.
Under the 2015 deal, Iran curbed its nuclear program in exchange for relief from US, EU and UN sanctions. But former US President Donald Trump reneged on the nuclear deal in 2018 and reinstated tough US sanctions, prompting Tehran to start violating the deal’s nuclear limits about a year later.
The Central African Republic (CAR), one of the poorest countries in the world, has also embraced crypto. It became the first African state to make bitcoin legal tender in April and launched its own digital coin last month.
Last year, El Salvador also adopted bitcoin as legal tender, although the project was beset by public skepticism amid falling crypto prices.
© Thomson Reuters 2022
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