Sanctions Remove Iran from SWIFT, Will it Switch to Crypto as Planned?

Sanctions Remove Iran from SWIFT, Will it Switch to Crypto as Planned? 1

This week, the U.S. officially removed Iran from the Society for Worldwide Interbank Financial Telecommunication (SWIFT) network, disallowing the Central Bank of the Islamic Republic of Iran from working with financial institutions worldwide. Iran could eye a switch to crypto as a response, as it hinted in early 2018.

The U.S. government imposed strict sanctions on Iran in May, removing commercial banks in the country from the SWIFT network. For the first time in history, Iran’s central bank has been removed from the SWIFT network, a move that essentially prevents Iran from sending and receiving transactions to and from its allies.

Heavy Criticism, Will Iran Adopt Crypto?

Speaking to RT, economist and Kingston University professor Steve Keen, heavily criticized the U.S. government for isolating the central bank of a sovereign nation from the global financial system.

Keen emphasized that no country should have the authority to force the usage of a single national currency for international payments nor should hold the power to remove countries from the system.

“The US has gone rogue, and cannot be allowed to dictate economic or political policy to the rest of the world. The sooner the rest of the world develops an alternate payments system – possibly working through SWIFT, but using a basket of currencies as the basis for a supra-national unit of exchange – the better. The USA is big enough to bully what should be an impartial means for monetary transactions between countries. This should not be possible,” he said.

Six months ago, subsequent to the imposition of additional sanctions on Iran by the U.S. government, Mohammad Reza Pourebrahimi, Iran’s Parliamentary Commission of Economic Affairs (IPCEA) head, said that the country has been working with Russia, its ally, to process international payments using cryptocurrencies.

Pourebrahimi claimed that the government of Russia approved the proposal of the Iranian government and expressed its positive stance towards the plan if the U.S. removes Iran from the SWIFT network.

“[IPCEA has already] obliged the Central Bank of Iran to start developing proposals for the use of cryptocurrency. Over the past year or two, the use of cryptocurrency has become an important issue. This is one of the good ways to bypass the use of the dollar, as well as the replacement of the SWIFT system. They [Russian authorities] share our opinion. We said that if we manage to promote this work, then we will be the first countries that use cryptocurrency in the exchange of goods.”

Merchants are Already Using Crypto

Several large businesses including HotelsinIran, a major hotel booking platform in Iran, have started to accept crypto as a payment method.

In July, Leonhard Weese, the co-founder and president of the Hong Kong Bitcoin Association, reported that HotelsinIran decided to integrate crypto after finding difficulties in accepting fiat currencies.

“Many people still look at cryptocurrencies and say ‘I won’t use this.’ But already in 2018 people are getting into the situation where they have to use cryptocurrencies as their only payment option, or else they can’t conclude their trade. This is how Bitcoin will eventually be adopted,” Weese said at the time.

Featured image from Shutterstock.

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CryptoCurrencyUSDChange 1hChange 24hChange 7d
Bitcoin61,602 0.56 % 3.06 % 0.33 %
Ethereum4,044.5 0.59 % 1.86 % 4.09 %
Binance Coin481.86 0.59 % 2.07 % 1.22 %
Tether0.9986 0.03 % 0.08 % 0.23 %
Cardano2.160 0.48 % 1.17 % 3.06 %
Solana199.58 1.37 % 6.20 % 22.46 %
XRP1.090 0.54 % 1.20 % 4.85 %
Polkadot30.87 2.19 % 17.29 % 10.73 %
USD Coin1.000 0.14 % 0.20 % 0.17 %
Dogecoin0.2462 0.66 % 0.79 % 4.75 %

bitcoin
Bitcoin (BTC) $ 61,761.00
ethereum
Ethereum (ETH) $ 4,053.27
binance-coin
Binance Coin (BNB) $ 483.00
tether
Tether (USDT) $ 1.00
cardano
Cardano (ADA) $ 2.16
solana
Solana (SOL) $ 201.71
xrp
XRP (XRP) $ 1.09
polkadot
Polkadot (DOT) $ 44.18
usd-coin
USD Coin (USDC) $ 1.00
dogecoin
Dogecoin (DOGE) $ 0.246173