Friday, May 18, 2018

A tale of two monies: Iranians using crypto to get out of dollars, and gold to get out of rials

With the chaos occurring across the landscape over President Trump's decision to tear up the 'Iran Deal', the Iranian government is wondering just how long they have until the U.S. either freezes their assets, or begins imposing more sanctions on them and their currency.

So with this in mind an interesting trend has been taking place over the past few weeks, and it involves the use of cryptocurrencies, and in particular Bitcoin, to get out of dollars so they can be offshored without delays.

Kim Jong-un tried it in North Korea, Nicholas Maduro tried it in Venezula — now Hassan Rouhani could begin experimenting with Bitcoin and cryptocurrency as the country braces for fresh, US led, Iran sanctions. 
In fact, in anticipation that the Obama-era deal would collapse, Iran began developing an experimental local cryptocurrency some time last year. - Forbes
Yet this short-term fix to get out of dollars does not solve the nation's upcoming crisis they are expected to have with their primary currency as the rial is already starting to devalue quickly.  And in response the people are looking not towards the rial or even cryptocurrencies for relief, but to the world's oldest form of money which is gold.
We’ve covered many facets of Iran, much more than just those three links above, but the point is that a currency crisis is a process that is ongoing, but what is clear is that the move away from the dollar is picking up speed. 
And what are the Iranians turning to? 
They are turning to gold. 
Here’s more from Radio Farda (bold for emphasis and making points later):
Referring to the formation of a “new forex market,” the chairman of the Iran Gold & Jewelry Association, Hossain Pendarvand, says gold has replaced the dollar in local markets and that despite protective measures taken by the Central Bank of Iran (CBI), money is still finding its way out of the country, but now in the form of gold. – Silver Doctors

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