How are the Major Industries of Iran Affected by Bitcoin?

The Iranian government, facing economic sanctions from the international community over its nuclear program, is seeking ways to use alternative currencies like bitcoin. The country’s national currency, the rial, has rapidly lost value against the dollar and gold as global oil prices hit four-year lows. To open a free crypto trading account, visit the official site of Profit Revolution.

9 Ways how Bitcoin Benefits the Significant Industries in Iran.

1. Foreign currency

Bitcoin is not under the control of any central bank and can be used to make international payments. The rial has dropped 42 percent against the dollar this year, exacerbating the country’s inflation rate of around 40 percent.

2. Remittances into Iran

Iranians abroad are estimated to send home between $500 million and $2 billion a year in remittances, accounting for nearly 20 percent of the Iranian economy. Bitcoin makes it almost free to transfer money from one country to another.

3. Purchasing imports

The cost of imported goods is also dropping in Iran as merchants can purchase inventory from abroad with bitcoin instead of dollars or rials.

4 – Expat Iranians

In May, the Iranian government banned some expatriates from working in Iran’s private sector, a move that made bitcoin all the more attractive for those who could afford it.

Expats were also the first to use bitcoins in retail transactions because much international travel passes through Dubai. For more info, click bitcoin investor.

5. eCommerce

Iranians are increasingly buying goods online worldwide, whether expensive electronics or daily consumer products. In addition, Bitcoin makes it much easier for Iranian citizens to purchase foreign goods without government meddling.

6 – Foreign investments & big companies

After western sanctions, many Iranians have begun using bitcoins as an alternative currency to dollars and rials. In addition, big companies such as Microsoft and Overstock accept bitcoin for payments, so Iranians can use the money to buy these products in their home country or when traveling abroad.

7 – Group-buying

Bitcoin lets users make purchases anonymously and track transactions with no fees involved. Several sites like CoinAva and Zaarly use bitcoin as a currency for group purchases.

8 – Mining

Iran has plans to invest $5 billion to increase power output over the next five years, allocating 15 percent of its overall budget toward this goal alone.

So there is a great demand for electricity, and it may be one of the main reasons Iran has become an important mining center.

9 – Inflation

Iranians used to keep their savings in hard currencies because the rial has been so volatile, but bitcoin offered a way to save money without worrying about inflation.

5 Negatives of Bitcoin that Affects the Major Industries of Iran

1 – Sanctions

Bitcoin is getting more and more attention in Iran as the rial’s value continues to plummet. Many Iranians are turning their rials into bitcoins, which they hope will increase their purchasing power amid international sanctions against the country over its nuclear program.

But people tend to forget that the bitcoin wallet isn’t anonymous if you link it to your bank account. In this case, if you live in Iran and you have the same bank account as coinbase, then when authorities access your bitcoin wallet, they can track all of your financial activities from years ago.

2 – Regulation

In May, Iran passed a law requiring Iranians to pay a 1 percent tax on all online transactions, whether made in rials or bitcoins. But even this hasn’t stopped Iranians from using the cryptocurrency.

3 – Transaction fees

Bitcoin transactions are slow, making it hard for consumers to make purchases in real-time. And because of its fluctuating value, merchants often end up paying more than they usually would when accepting bitcoins for their products or services. As a result, the high transaction fee can result in a lot of money wasted on the transaction.

4 – Black Market

It’s straightforward to trade bitcoins into dollars or rials and then buy subsidized items (like fuel) that are only available in Iran at regulated prices, which means you’re getting something for nothing.

This act is called smuggling because people take advantage of government control to get cheap goods for their families in Iran and travel.

Conclusion

As you can see, bitcoin is beneficial for Iranian people. The technology lets them use the same currency for domestic and international transactions, avoid government control and finally get rid of sanctions. But Iran also needs to be careful of the black market, which might cause significant issues in the future.

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