Introduction
Iran has always been in economic turmoil because of its foreign policy and controversial nuclear program. The recent rise in the financial crisis is a consequence of the trade embargo imposed upon Iran by the United States in 2019. The embargo was imposed after Iran abandoned the 2015 Nuclear Agreement it had with the United States and its allies. Resultantly, the Iranian government legalized cryptocurrencies to make up for missed out trade opportunities and improve the state of the economy. Let us know about “Does Iran Accept Bitcoin?”
To keep it short, yes Iran does accept cryptocurrencies such as Bitcoin. However, the following article explains the challenges and future of such a digital currency in Iran and its implications. In January 2022 Iran announced to accept Bitcoin for international trade to soften the impact of trade sanctions levied by the US. According to reports, the Central Bank of Iran (CBI) will design a mechanism for bitcoin operations by working with the Ministry of Trade.
Relationship Between Iran And Bitcoin:
Iran recognized the Bitcoin mining industry and all other cryptocurrencies in 2018 for the first time after noticing an increase in the number of illegal mining farms. According to reports in Iranian media, Iran has been producing four to six percent of the total Bitcoins around the globe. which is equal to $ 660 million. However, the association between Iran and Bitcoin has been marked by several difficulties.
Reason
The major reason behind uneven bitcoin production and trade is the burden on the country’s power sector which is already in a poor state of affairs due to subsidies given to consumers. In 2018 alone, illegal cryptocurrency mining farms robbed the power sector of 1500 Megawatts according to Iran International. Cities faced long power cuts amidst sweltering heat. Therefore, a four-month-long ban was imposed on the mining of all cryptocurrencies from May to September. The ban was lifted as soon as the temperatures dropped but the same practice was repeated in 2020.
Therefore, in 2021 a law was proposed by the Iranian Parliament to foster and nourish the Crypto trade without inducing a burden on the power sector. Parliamentarians want to reap the benefits of digital currency by investing it in trade. In light of this law, cheap loans were provided to the owners of Bitcoin mining farms for setting up their powerhouses.
Current Scenario
As of now, Iran has 50 legal farms that are mining Bitcoin according to the official number. On the contrary, the actual number is much higher than reported. Authorities revealed that eighty percent of all the mining taking place in the country is illegitimate. In 2021, Tehran Police shut down more than 7000 mining computers as the power outages in major cities became frequent, pushing the authorities to impose another ban.
The inflow of Chinese money from investors eyeing to benefit from government facilities provided to licensed farms is rapidly saturating the industry.
Future Of Bitcoin In Iran
The future of Bitcoin, Ethereum, and other similar digital currencies seems to be quite promising around the world, including in Iran. The country has announced a launch of its own gold-backed digital Rial after the Supreme Leader Ali Khameini has termed it legal according to the Islamic Shariah Laws. This will uplift Iran’s economy as reservations and concerns regarding the legality of cryptocurrencies would diminish, however, the Central Bank of Iran has shown reservations about accepting other digital currencies.
Conclusion
Bitcoin has turned out to be a popular currency in Iran, however, due to slow regularization and controversies regarding its legality, the adaptation has been sluggish. Despite these concerns, statistics show a rising interest in Bitcoin.
Frequently Asked Questions:
What is Bitcoin?
A digital currency that can be used or transferred without any bank. It is rather managed by peer-to-peer bitcoin networks. It is also free of the influence of governments or other private entities. So it is registered in a blockchain ledger which is accessible to everyone in the digital realm. On the other hand, it is not yet accepted by governments around the world but Iran has recently jumped on the bandwagon.
How can one buy or sell Bitcoin in Iran?
One can buy or sell cryptocurrency through exchangers in major cities where customers can buy or sell Bitcoin or any other cryptocurrency using the Iranian Rial. Another way is through Persian websites which deal in cryptocurrencies. All other websites such as Bitcoin.com, Jaaxx, Blockchain, and even exchange websites like Changelly show a huge informal trade volume from Persian websites.
The Iranian websites dealing in cryptocurrency such as Arzdigital show an increase in traffic even when Cointelegraph and Coindesk showed a decline in the number of visitors in 2017.
Which are the most reliable platforms dealing with Bitcoin in Iran?
Changelly, Arzdigital, etoro, Kraken and Coinbase are the top rated ones.
