Iran Approves Use Of Cryptocurrency For Imports To Bust Sanctions

Iran has officially approved the use of cryptocurrency for imports as a measure to circumvent US sanctions imposed on its finance and banking sector. 

Industry, Mines and Trade Minister Reza Fatemi Amin said on Monday that the regulations for using cryptocurrencies instead of dollar and euro was finalized by the administration on Sunday. 

"All the issues related to crypto-assets, including how to provide fuel and energy, and how to assign and grant licenses were devised," he added. 

The use of cryptocurrencies in imports is one of the ways to circumvent sanctions because cryptocurrencies are not traded through normal channels such as banks and it is very difficult to track them.

Earlier in the month, Iran made its first official import cryptocurrency order, worth $10 million, as a test run for allowing the country to trade through digital assets that bypass the dollar-dominated global financial system and to trade with other countries similarly embargoed by US sanctions, such as Russia. 

"By the end of September, the use of cryptocurrencies and smart contracts will be widely used in foreign trade with target countries," said Alireza Peymanpak, a deputy Iranian trade minister who leads Iran’s Trade Promotion Organization (TPO). 

Iran has a complex relationship with cryptocurrencies, which have helped hide various kinds of illicit trades banned by US and other European sanctions but creating them is highly energy-intensive. In 2019, Iran’s central bank banned trading of cryptocurrencies inside the country but the government allowed the use of cryptocurrencies like bitcoin to pay for imports.