Iran allows usage of crypto to settle foreign payments amid complete U.S embargo

The Islamic Republic of Iran has had a complicated relationship with cryptocurrencies over the years. Anyone following the developments would certainly agree with this. In the latest move, Iranian authorities on 28 December decided to halt operations of authorized cryptocurrency mining centers. Well, the country’s energy consumption increased with the dipping temperature, and therefore, increasing the possibility of blackouts.

That said, the development below could be the lead charge of a transaction in strict regulations within this region. At least, that’s what crypto users could hope for.

New developments

The Central Bank of Iran (CBI) and the Ministry of Industries, Mining, and Trade have reached an agreement to allow businesses to make use of cryptocurrency to settle payments to foreign partners. As per the local news body, the partnership will link the CBI crypto platform to the Comprehensive Trade System.

Head of Iran’s Trade Promotion Organization (TPO) Alireza Peyman-Pak reiterated:

“We are finalizing a mechanism for operations of the system. This should provide new opportunities for importers and exporters to use cryptos in their international deals.”

This development comes just after a few days after the recent statement. He asserted that his organization was pursuing the removal of barriers in the way of maritime transportation of export commodities. Well, fair to say, it turned out to be a success.

These cryptocurrencies could be used to pay for imports, thereby reducing the chances of suppliers being punished by the U.S. because of the sanctions imposed on Iran.

(For context: The United States imposed an almost total economic embargo on Iran, including a ban on all imports including those from the country’s oil, banking and shipping sectors.) 

Once a friend, always a friend

This was exactly the reason why the Iranian government adopted Bitcoin for international trade. Furthermore, the said move was seen as a path to offset the economic crisis. Steve H. Hanke, Professor of Applied Economics at Johns Hopkins University described the situation in Iran as “a classic death spiral.”

Overall: From a complete ban perspective to this recent development, is this a major win for Iranian crypto users?