Iran has been turning to Bitcoin more than ever to boost its economy amidst the COVID-19 pandemic by acting as a destination for Chinese “Bitcoin farmers” and allowing cryptocurrency as a valid form of payment for imports.
Iran’s economy has been hard-hit by the COVID-19 pandemic, motivating Iranian officials to legislate the legal use of Bitcoin as payment for imports while also potentially creating a loophole to manipulate U.S. sanctions on international banking, according to Bitcoin.com.
“The Iranian government amended its regulations on cryptocurrencies to allow them to be exclusively used for funding imports at a time of increased pressure on the country’s normal use of hard currencies,” Iran Daily reported.
Iran is an ideal destination for Chinese “Bitcoin farmers” due to its cheap and abundant energy; however, “Bitcoin farming” puts an enormous strain on Iran’s power grid, a move that has far-reaching consequences for the Iranian people who have been suffering from energy blackouts since January.
Chinese “Bitcoin farmers” are economically benefiting the Iran regime while exacerbating already existing tensions between the Iranian people and their oppressive government, as China is known for supporting the regime against the wishes of the vast majority of Iranian people who favor ousting the theocratic government in favor of a secular democracy.
Although the regime has closed 1,600 mining facilities within its borders, some speculate that Bitcoin is simply being used by Iranian officials as an excuse for more far-reaching issues within the regime’s infrastructure.
While Bitcoin may be causing issues with Iran’s power grid, some Iranian people do benefit from use of the cryptocurrency.
“Iranians understand the value of such a borderless network much more than others, because we can’t access any kind of global payment networks,” explained Tehran-based Bitcoin expert Ziya Sadr to ABC News.
Iran accounts for 3.82 percent of the world’s hash power, or mining capability, landing it in the top ten, according to Bitcoin.com.