Iran makes a step forward for the cryptocurrency adoption and usage for its imports
By Inkarias - 2020-10-30
Iran recently became the very first country in the world to use cryptocurrencies at a state level for value exchange. The Iranian Cabinet has amended legislation to redirect cryptos into the Central Bank of Iran’s funding mechanisms for imports, according to a Saturday report by the official IRNA news agency. As the CBI and Ministry of Energy stated in the report :
“The miners are supposed to supply the original cryptocurrency directly and within the authorized limit to the channels introduced by the CBI”
The legal cap for the amount of cryptocurrency for each miner would be determined by the level of the subsidized energy used for mining and based on instructions published by the Ministry of Energy. Iranian money value has drastically fallen with inflation sitting at 34%, a situation that has been continuously present since 2018. The country is in the grip of US sanctions and therefore can not use dollars for international trade , being a great chance to add cryptocurrencies to the different assets supported for financial freedom.
A digital choice for a brighter economic future
Iran is therefore turning to bitcoin and become first country to do so at a state level, with the famous bitcoin volatility less of a consideration here because the situation is desperate. Iran’s economy has been contracting for much of last year and this year at circa -10% a quarter, making this a depression. However, after some experimentation with cryptos starting in 2018, it appears Iran has found a use case in both creating economic value through facilitating crypto mining, and now in using bitcoin for international trade. Bitcoin brings a value-added proposition for exchanges of goods and simplify the whole import process. By making the choice to join the cryptosphere , Iran is bypassing the dollar and other fiat currencies by using it daily.