Is Iran Readying Itself To Use Bitcoin To Evade Sanctions?
As US sanctions cripple the Iranian economy, it looks like Iran is readying itself to start using Bitcoin to help get it back into global trade.
The Iranian rial has fallen 54 % against the USD since the start of this year, and the economic situation there is bleaker than most places.
With the long standing US sanctions making life and trade difficult for Iranians, the government is starting to put into place regulations to allow it to trade internationally using Bitcoin and other cryptocurrencies.
Will Iran Be Using Bitcoin to Evade US Sanctions?
On the face of it, Iran has been pro-Bitcoin for a while now. The government introduced regulations for its crypto industry in August 2019. This included legalising limited use of cryptocurrencies within the confines of the country’s foreign currency laws.
And many believe it’s to help Tehran get around US sanctions.
Further, Iran ramped up its pro-Bitcoin stance, last week, when it amended cryptocurrency legislation to allow the Iranian central bank to use cryptocurrencies to pay for imports.
State run Islamic Republic News Agency (IRNA) reported that the cabinet had introduced the new amendment that legalizes the use of Bitcoin for import funding by the Central Bank of Iran (CBI).
It makes Iran the first country to legalize Bitcoin use at a state level. And it also enables the government to use Bitcoin to pay for imports and get around the punitive measure implemented by the US government.
The new law amended means that all the legally mined cryptocurrency in Iran can only be exchanged against funding imports to Iran from other countries.
It’s not clear if the government has Bitcoin on its balance sheet, but it’s believed either way that the Iranian miners will now have to sell their BTC to the central bank directly.
Local English language media outlet Iran Daily ran the story, explaining how miners would have to sell their cryptocurrencies to the Central Bank of Iran (CBI).
‘Based on the laws, cryptocurrencies legally mined in Iran will only be exchangeable when they are used to finance imports from other countries,’ claimed the report. ‘The miners are supposed to supply the original cryptocurrency directly and within the authorized limit to the channels introduced by the CBI.’
Tough For Iranian Miners, But The Iranian Mining Industry Is Growing
Cryptocurrency analyst Alireza Shamkhi said the new law was vague and ambiguous, and the money earned by the miners for their hardwork wasn’t clearly stated in the “agreement”.
Before the new policy, miners could exchange their Bitcoin or other mined cryptos for any chosen currency at market prices. However, the likelihood is that they will be offered a less than favourable price going forward.
With all the uncertainty and government intervention, one might think the Bitcoin mining industry would be slowing down in Iran, but it’s rather the opposite.
Power plants in Iran are also allowed to mine Bitcoin and licenced miners have been granted exclusive access to electricity generated from three of them.
So, it appears the Iranian government is pro-Bitcoin and the mining industry is blooming.
However, with the new legislation coming through in recent weeks it’s becoming more apparent that much of it is for the government’s own benefit.
Author: Pablo Clarke
Where can I buy Bitcoin in Iran?
There are several exchanges operating in Iran, but there are some suspect platforms so be careful. However, the most recommended exchanges are Kraken or Blockfi. Or you can buy Bitcoin from Bitcoin marketplaces, such as LocalBitcoins or Paxful. All of these exchanges and marketplaces are global with high liquidity and excellent customer service. Feel free to read the reviews of each one.
How long does it take to mine 1 Bitcoin?
On average, the time it takes for miners to mine Bitcoin is 10 minutes. But they don’t just mine 1 BTC. Mined Bitcoins are created with every new block and these produce the Bitcoin block reward which at the moment is 6.25 BTC, so you could say it takes less than 2 minutes to mine each Bitcoin.
Where is the best place to buy Bitcoin?
There are many great places to buy Bitcoin, and it all depends on your preference. You can buy on typical cryptocurrency exchanges, such as Binance and Coinbase. Or you can buy from peer-to-peer Bitcoin marketplaces, such as Paxful and LocalBitcoins. You can also buy Bitcoin from Bitcoin ATMs. It all depends on your location and preference. Check out our reviews for the best place to buy Bitcoin.
Can you buy less than 1 Bitcoin?
Yes. Every Bitcoin can broken down into 100 million bits. They are known as satoshis, after the pseudonymous creator Satoshi Nakamoto. And some companies will let you buy as little as $1 worth of Bitcoin, which at time of writing is worth about 11,000 satoshis.