In late Feb, an Iranian general called for an interesting way to bypass US sanctions imposed on the country. Saeed Muhammad proposed that Iran use cryptocurrencies to evade economic sanctions.
According to Coinit.ir, a crypto news organization in Iran, he addressed crowds on 26 February: “We are demanding the creation of a more sophisticated mechanism to bypass sanctions.
“To circumvent sanctions, we must develop solutions such as the exchange of products and the use of cryptocurrencies with our partnerships [in other countries].” An Iranian general has made a big call on crypto, that could hopefully have a positive impact on the struggling nation.
What are cryptocurrencies?
Cryptocurrencies were invented in 2009 when Satoshi Nakamoto released Bitcoin. Since then, the market has grown to a $260 billion industry (at the time of writing).
Cryptocurrencies are, in essence, a form of digital money that is typically built on a technology called the blockchain. They are decentralized and require no interference from external parties and traditional institutes like banks and governments.
Iranian General says sanctions impact citizens
Iranian citizens have seen their currency drop in value in the wake of economic sanctions imposed by the Trump administration. Trump withdrew from the Joint Comprehensive Plan of Action in 2018, and tensions between the two countries have been growing since.
The intergovernmental Financial Action Task Force also added Iran to a list of blacklisted nations, for not complying with anti-terrorism agreements.
These sanctions have isolated Iran from foreign trade and investment, with cryptocurrency becoming an increasingly viable way to get around them. Bitcoin has been described as one of the only ways to get funds in and out of the country.
Now, an Iranian general has made a big call on crypto, which could positively impact the way the country responds to economic sanctions.
Sanctions have a major knock-on effect
US economic sanctions imposed on Iran have caused the country’s economy to essentially enter a free fall. They have knock-on effects on every single aspect of the economy, and there has to be a way to circumvent it.
Iran is not the only country that suffers under US sanctions. Many nations around the world have had the US dollar weaponized against them.
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Iran needs to act, quickly
An Iranian general has made a big call on crypto, which could have positive implications for the country’s struggling economy. US sanctions imposed on Iran are effectively crippling its economy, as foreign trade and investment are essentially forbidden.
Bitcoin has been described as one of the only ways to get money in and out of the country, and mining is already on the rise. It seems as though crypto may very well be the saving grace here, and not just Iran needs it.