In a historic move, Iran has placed its first ever official import order using cryptocurrency this week, the semi-official Tasnim news agency of the nation reported. This move could enable the Islamic Republic to circumvent U.S. sanctions that have crippled the economy.
The order, worth a massive $10 million, is the first step towards allowing the country to trade through digital assets that bypass the dollar-dominated global financial system and to trade with other countries similarly limited by U.S. sanctions, such as Russia. But Iran’s news agency didn’t specify which cryptocurrency was used in the transaction, as per a Reuters report.
“By the end of September, the use of cryptocurrencies and smart contracts will be widely used in foreign trade with target countries,” an official from the Ministry of Industry, Mine and Trade reportedly said on Twitter.
All this comes amid the United States’ imposition of an almost total economic embargo on Iran, including a ban on all imports including those from the country’s oil, banking and shipping sectors.
Iran’s capital Tehran is one of the largest economies yet to embrace cryptocurrency technology, born in 2008 as a payments tool aimed at eroding governmental control over finance and economies, as per Reuters report.
Last year, a study found that 4.5% of all bitcoin mining was taking place in Iran, partly as a result of the country’s cheap electricity. The mining of cryptocurrency could reportedly help Iran earn hundreds of millions of dollars that can be used to buy imports and lessen the impact of sanctions.
This step towards crypto by Iran comes despite the market meltdown this year, which saw many major cryptocurrencies, including Bitcoin, Ethereum, Dogecoin etc, bleeding red, besides the crypto market losing trillions of dollars in market cap.
Besides this step by Iran, till now two countries have officially adopted bitcoin as a legal tender. First was El Salvador in September 2021, and then in April 2022, one of the world’s poorest countries, Central African Republic had adopted bitcoin as its official currency.