Politicians in Iran and Russia are discussing the possibility of using digital currencies to bypass sanctions.
Cryptocurrencies: A Tool for Bypassing Sanctions
Decentralization is one of the biggest advantages of cryptocurrencies. Unlike traditional fiat currencies, cryptocurrency transactions cannot be stopped by a central party or authority.
Some countries have sanctions imposed on them by the USA and many European nations. Several experts believe that certain countries may be bypassing international sanctions by using decentralized cryptocurrencies. Russia and Iran are two countries that are currently under heavy sanctions that may soon use cryptocurrencies to bypass sanctions.
How Iran and Russia May Benefit from Cryptocurrencies
In a recent news report by PressTV, Iranian MP Mohammad-Reza Pourebrahimi discussed in a meeting in Moscow the possibility of using cryptocurrencies for international payments. Dmitry Mezentsev, the Chair of the Federation Council Committee on Economic Policy, also attended the meeting.
According to reports, MP Pourebrahimi stated that Iran and Russia could use digital currencies to avoid U.S. dollar transactions and potentially even replace the SWIFT interbank payment system. In addition, the Iranian parliament has tasked the Central Bank Of Iran (CBI) to start creating potential use cases for digital currencies. Pourebrahimi stated:
They [Russia] share our opinion. We said that if we manage to move this work forward, then we will be the first countries that use digital currencies in the exchange of goods.
Mezentsev noted Pourebrahimi’s statement concerning the use of cryptocurrencies, saying:
Interbank relations between our countries should be of great importance.
Many sanctioned countries may see cryptocurrencies as a potential replacement for traditional international banking systems like SWIFT. International banking transfers aren’t the only problem that sanctioned countries are facing. Centralized payment services like Paypal or Venmo are also not allowed to operate in certain countries. These payment services can also be replaced with decentralized cryptocurrencies.
Iran is facing serious sanctions again after President Trump pulled the United States out of the deal struck by the Obama administration with Iran over their nuclear weapon program. Russia has seen increased sanctions by the U.S. over their alleged meddling in the 2016 presidential election.
What are your thoughts on Iran and Russia using cryptocurrencies to bypass sanctions? Do you think that more countries could use cryptocurrencies for international money transfers? Let us know in the comments below!
Images courtesy of Pixabay and Shutterstock.
