Iran Turns to Cryptocurrency Amidst Economic Turmoil
The Central Bank of Iran (CBI) has made significant moves to address the nation’s deepening currency crisis. According to recent findings from the crypto analytics firm Elliptic, Iran has purchased over $500 million in Tether’s USDT stablecoin during 2025. This strategic decision sheds light on how cryptocurrencies are becoming tools for nations facing economic challenges.
The Collapse of the Rial and Its Implications
Iran’s national currency, the rial, has plummeted to historic lows. By early 2026, the rial’s purchasing power was so eroded that it was nearly unusable for international trade. This depreciation led to widespread dissatisfaction and panic within both public and business sectors. Sanctions imposed by international communities further exacerbated the financial instability, restricting Iran’s access to global financial markets.
Stablecoins: A Parallel Reserve for the Struggling Economy
Cryptocurrencies, particularly USDT, have proven to be a reliable alternative for the Iranian government. USDT, being a dollar-pegged stablecoin, offers stability and utility amid the rial’s volatility. Elliptic uncovered documentation linking significant USDT purchases to the Central Bank. These purchases, often financed through UAE dirhams, highlight a concerted effort to stabilize domestic liquidity and hold value beyond traditional fiat reserves.
Initially, most of the purchased stablecoins flowed into Nobitex, Iran’s largest cryptocurrency exchange. USDT acted as a parallel dollar reserve for the Central Bank, enabling quick conversions into local currency when needed. However, systemic risks swiftly emerged due to hacking incidents and increased scrutiny.
Security Breaches Accelerate Operational Shifts
In June 2025, cyber-attacks disrupted Iran’s cryptocurrency strategy. A pro-Israeli hacker group, “Predatory Sparrow,” targeted Nobitex, wiping out 95% of the exchange’s assets. This incident included an $80 million hack that significantly reduced the exchange’s balance sheet. Consequently, the Central Bank shifted to using decentralized protocols, employing cross-chain bridges to secure funds and mitigate future vulnerabilities.
Calls for Transparency Amid Rising Concerns
Allegations regarding the safety and secrecy of the Central Bank’s wallet infrastructure have been increasing. Business magnate Babak Zanjani recently accused the authorities of suffering from information leaks. He alleged that these breaches exposed critical wallet addresses to hostile networks. With such claims capturing public attention, many have called for increased transparency and accountability from the Central Bank.
The Role of Stablecoins in a Changing Financial Landscape
Iran’s reliance on USDT highlights the broader potential of stablecoins in managing economic crises. With restrictive sanctions limiting access to the global banking system, cryptocurrency becomes a bridge for facilitating trade and maintaining financial liquidity. As global reliance on decentralized solutions grows, Iran’s case serves as a point of innovation—and contention—for cryptocurrency use on the state level.
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