A recent article published on the CoinTelegraph Website – dedicated to Bitcoin news– has created a buzz on social media about how Iran can continue to do trade with the world using the emerging digital currency.
The article highlights the trials and tribulations of trading with Bitcoins within Iran despite western sanctions placed on Iran over a nuclear energy dispute.
Referring to the sharp devaluation of the rial in 2012, the op-ed states that it was a disaster of the worst proportions when the previous government began to hunker down under the pressure of the sanctions.
Iran was all but cut off from the international monetary system. “This means no Mastercard, no Visa card and even no SWIFT. Iran’s wire to other countries’ financial systems was cut,” the article reads. The situation became so acute when the effects of US sanctions included expensive basic goods for Iranian citizens, and an aging and increasingly unsafe civil aircraft fleet. Iranian airlines including Iran Air were not able to purchase equipment, which caused many incidents and deaths during the last couple of years.”
When the dollar jumped against the rial in 2012, many traders and consumers began to look for other areas to invest in. People needed to find alternative asset classes for their hard earned money. Some invested in property, others in the Tehran Stock Exchange and some even took a punt on the fine art industry. However, the article says, “there was a fifth group which needed liquidity and needed it fast, these people took a leap of faith and changed their money into Bitcoins.”
In fact Bitcoins became so popular among traders in Tehran for their decentralization and non-traditional status amongst other tradable currencies, it claims.
The digital currency began to spread by word of mouth and sooner, rather than later people began to mine it themselves, even creating online communities in major cities like Tehran and Mashhad, it reads.
Soon companies began getting in on the act, with even one shoe company in Isfahan offering their footwear for Bitcoins. This was the first time a company formally offered its sellable items using the digital currency – a sea change in the sales industry. However, the currency has taken some hits recently and fluctuated internationally against other currencies.
The op-ed states that many people in Iran are used to fluctuations in currencies, and some traders have cooled to the idea of the digital currency because of this.
The long term future for the currency remains unknown. The idea of Bitcoin being traded amongst other currencies has caught the attention of the government also. They conducted research on the issue, but as of now the jury is out on the Bitcoin.
