The Iranian government's decision to accept cryptocurrency payments from cargo ships traversing the Strait of Hormuz is consistent with its existing trade networks that bypass sanctions. This development has been confirmed by a spokesperson for Iran's Oil, Gas and Petrochemical Products Exporters' Union, who stated that bitcoin is being accepted as a payment method, with a fee of $1 per barrel of oil. The Iranian regime, particularly the Islamic Revolutionary Guard Corps (IRGC), has been leveraging cryptocurrency to facilitate international trade, especially oil sales, as per data from blockchain analytics firm Chainalysis. Experts like Andrew Fierman, head of national security intelligence at Chainalysis, find it unsurprising that cryptocurrency is being used for such transactions, given the complexity and scale of Iran's sanctions-evading trade networks.
A review of sanctioned activities over the past year and a half reveals a growing and intricate network utilizing crypto wallets, with instances of Iranian oil sales to Yemen and Houthi financiers purchasing weapons and commodities from Russia. The use of cryptocurrency, especially stablecoins, enables the Iranian regime to engage in cross-border trade more easily, bypassing traditional banking systems and sanctions.
According to Fierman, the IRGC has a network of cryptocurrency wallets that facilitate this activity, making it simpler to accept crypto payments than to use the traditional banking system. The adoption of cryptocurrency by the Iranian regime, particularly for cross-border trade, is distinct from North Korea's focus on stealing and laundering crypto. The comprehensive sanctions imposed on Iran since 1979 have limited its access to US dollar-pegged assets, making cryptocurrency an attractive alternative for international trade. Experts like Tom Keatinge and Lee Reiners agree that USD-backed stablecoins have become a crucial payment mechanism for the Iranian regime, allowing it to evade sanctions and Western banking controls.