trade

Iran's Trade ministry has approved the use of cryptocurrency payments for imports in a bid to bolster trade in the country.

Iran’s Industry, Mines and Trade ministry has approved the use of cryptocurrency for imports into the country amid ongoing international trade sanctions.

According to local news reports, trade minister Reza Fatemi Amin confirmed that detailed regulations have been approved outlining the use of cryptocurrencies for trade and supplying fuel and electricity to Bitcoin (BTC) and crypto miners in the country.

Amin outlined the regulatory change at an automotive industry exhibition on Aug. 28, just a week after the country had placed a first-ever import order for vehicles, to the tune of $10 million, using cryptocurrency as a payment method. The Iranian trade ministry had previously indicated that the use of cryptocurrencies and smart contracts would be widely used in foreign trade by September 2022.

Following the cryptocurrency-funded import, Iran’s Import Association called for clear-cut regulatory parameters to ensure that local businesses and importers are not hamstrung by shifting directives.

The minister noted that the new regulations specify all issues related to cryptocurrencies, including the process to grant licenses as well as the provision of fuel and energy to mining operators in the country.

It is understood that local businesses will be able to import vehicles into Iran and a range of different imported goods using cryptocurrencies instead of U.S. dollar or euro payments.

Related: Iran to stiffen penalties for illegal use of subsidized energy in crypto mining

International trade sanctions against Iran have been largely due to opposition to its nuclear program, which has essentially cut the country out of the global banking system.

Iran has since shifted its attention to adopting cryptocurrencies as a means to address and potentially bypass sanctions for imports, given the decentralized nature of public blockchains like Bitcoin and Ethereum, which are not controlled by government or central authorities.

The Iranian industry, mines and trade ministry granted operating licenses to 30 crypto mining centers in the country in June 2021, while more than 2,500 permits were approved for the establishment of new mining operations. In the months that followed, the government also cracked down on illegal mining operations and even imposed a three-month ban on mining to alleviate pressure on its national grid.