Sanction-hit countries are finding it difficult to make international payments due to severe economic restrictions. As a result, alternatives to traditional cross-border transactions are made accessible to interested entities.
Iran can use digital assets to escape the biting U.S.-imposed sanctions and order goods and services for the first time.
This is the country’s first cross-border payment for products using cryptocurrency. Therefore, it represents a massive boost for the expanding digital currency ecosystem.
Iran Announces Import Payment in Cryptocurrency
To sidestep U.S. sanctions, Iran has announced that it has conducted its first international settlement using digital currency. According to the country’s deputy minister of industry, mines, and trade, Alireza Peyman-Pak, Iran has settled its first import using crypto. Peyman-Pak added that the settlement paid in cryptocurrency is worth $10 million.
The junior minister further disclosed that Iran would incorporate cryptocurrency payment for international trade. Peyman-Pak reiterated that this would become part of Iran’s foreign trade toward the end of next month.
The Iranian official also stated that using digital currency and smart contracts has exposed the country to possibilities in international trade.
In another development, the latest news came just days after the United States Treasury added Ethereum’s Tornado Cash among its sanctioned virtual assets.
Cryptocurrency to the Rescue
The Middle Eastern powerhouse has been under U.S. sanction since 1979. The United States has, in response to Iran’s nuclear project, slammed a heavy economic embargo on the country.
As Iran groans under the weight of sanctions, the Persian nation turns to cryptocurrency to subvert the U.S. grip on its economy.
Cryptocurrency payment systems provide a borderless and uncensored means of transferring and making payments.
Reuters reported in July that Binance has long been offering crypto services to Iranians despite the sanctions. This shows that Iranians had long used crypto assets before their government adopted them.
North Korea is another country that has implemented evasive measures to escape from U.S. sanctions.
It is widely alleged that North Korea is the mastermind behind a high-profile cyber attack on the crypto industry. The industry lost millions of dollars worth of crypto assets to exchanges and blockchain network attacks.
In addition, it is also alleged that the country uses the proceeds of the hack to fund its nuclear programs. However, the crypto ecosystem is highly decentralized, and authorities find tracing payments in and out of a particular country challenging.
Many argue that using crypto to evade sanctions is unrealistic, but this has proven to be the opposite. However, some have claimed that the so-called decentralized nature of cryptocurrencies is a fallacy.
This made it easier to ridicule the concept of the decentralization of digital currencies. Nations Nevertheless, sanctioned states can still navigate how to pay for international trade via cryptocurrencies.
Meanwhile, Iran has not disclosed any specific details about the new development.