Iran's Trade Promotion Organization said $10 million in cryptocurrency was used recently for settling an import bill.
Alireza Peymanpak, the TPO chief, made the announcement in a tweet noting that the country is targeting implementation of smart contracts in foreign trade arrangements by October, Peyvast magazine quoted him as saying. It did not elaborate.
Ahmad Salehi, an advisor to the TPO, said last week that grounds are prepared for using cryptocurrency in foreign trade. "We have reached [preliminary] agreements and permits have been issued for using cryptos for import and export."
In January, the Central Bank of Iran and the Ministry of Industries, Mining and Trade reached agreement to link the CBI crypto platform to the Comprehensive Trade System, which allows businesses make use of cryptocurrency to settle overseas payments.
Peyvast claimed that that measure was halted due to the CBI's opposition, saying that recent reports indicate the central bank has reapproved the measure. CBI has not commented so far.
Peymanpak said earlier “There may be restrictions for using cryptos when dealing with some countries like Iraq, Afghanistan and Pakistan." However, the digital currency can help Iran in export destinations where crypto is used such as Russia, China and India, he noted.
Blockchain and cryptos have many uses in international trade and finance, he recalled. "We stand to lose if we fail to employ new technologies” in trade with the outside world.
Evading Sanctions
After former US president Donald Trump waked away from the Iran nuclear agreement and imposed sanctions in 2018, the CBI was urged to allow the use of blockchain technology to help evade the unilateral US economic blockade.
That year the Majlis Research Center called for the targeted use of cryptocurrency to circumvent the hostile Trumpian restrictions.
The World Trade Organization has said blockchain could revolutionize global trade completely. A 2018 WTO report noted that international trade could look “radically different” in 10 to 15 years.
Russia Ties
After the sanctions were announced on Russia for invading Ukraine in February that cut off Russian banks’ access to SWIFT, Tehran and Moscow are in the process of creating a rival to SWIFT for cross-border payments.
Central banks of the two countries are also working on connecting their domestic bank card networks.
At the same time, blockchain policymakers and developers in the two countries are considering blockchain and crypto as an alternative for two-way trade.
Anton Tkachev, deputy of the State Duma, said during a recent visit to Tehran that the both sides have the technological potential crypto collaboration.
Victor Goncharuk, vice-president of Russian Association of Crypto Industry and Blockchain, said Iran has made progress in terms of technical issues and called for creating a joint payment system for bilateral transactions.
"By enhancing collaboration in crytpo exchanges and blockchain technology, Iran and Russia can develop a joint ecosystem," he said.
The International Monetary Fund said in April that countries such as Russia and Iran may eventually use cryptomining to evade sanctions.
There’s a risk that sanctioned nations will leverage their energy resources -- which can’t be exported -- to power mining, an energy-intensive process of validating coin transactions, the IMF said.
By expanding their mining operations, governments could also generate revenue directly from transactions fees, the fund said.
