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ANALYSIS

Iran’s two crypto economies: state guile and household survival

Mohamad Machine-Chian
Mohamad Machine-Chian

Iran International

Jan 25, 2026, 19:18 GMT+0

Cryptocurrency is a rare tool embraced by both Iran’s rulers and its citizens—used at the top to enrich elites to dodge sanctions and at the bottom to survive the economic devastation wrought by their policies.

Blockchain forensics firm Chainalysis estimates that Iran’s crypto ecosystem exceeded $7.78 billion in 2025.

Any figure attached to Iran’s crypto economy is of course partial: both the state and private users have powerful incentives to conceal activity, whether to limit sanctions exposure or avoid domestic scrutiny.

What is increasingly clear, however, is that the state now dominates a large share of that volume.

Chainalysis estimates that the Islamic Revolutionary Guard Corps processed more than $3 billion in crypto transactions last year. Israel’s counter-terror financing authority has published a seizure order listing 187 crypto addresses worth roughly $1.5 billion in Tether, a crypto denomination pegged to the dollar.

New findings by the blockchain analytics and crypto-compliance firm Elliptic link Iran’s central bank to at least $507 million in purchases of dollar-pegged Tether (USDT).

That stockpile could supplement constrained foreign-exchange reserves and help authorities lean against sudden spikes in the rial’s parallel market.

In effect, USDT can function as an off-balance-sheet foreign-exchange buffer: accumulated outside correspondent banking channels, mobilized through intermediaries, and sold into rial markets via local exchanges and over-the-counter desks when pressure builds.

Access, however, is not evenly distributed. Reports indicate state blessing for—or "whitelisting"—internet connectivity for certain traders, even as much of the country has endured a pervasive internet blackout since a deadly crackdown on protestors ramped up on Jan. 8.

When the rial comes under pressure, connectivity itself becomes an instrument of intervention: stablecoin-based market operations still require traders who can connect, quote prices, and settle transactions.

Alternate reality for households

Iran’s central bank has imposed limits on currency trading and transaction flows, while rolling out an anti-speculation tax regime covering gold, jewelry, foreign currency and cryptocurrencies.

The effect has been to raise the cost of traditional inflation hedges while signaling that policymakers now view household portfolio shifts as a macroeconomic risk.

The central bank has moved to cap individual crypto holdings at $10,000, despite warnings from Iranian traders and economists that such restrictions would choke savings and push activity further underground.

On the mining side, the divide is even starker. State-linked and religious institutions are among the largest players, in part because electricity tariffs in Iran are not uniform.

Iran International has reported repeated allegations of crypto mining at state-sponsored sites, including mosques, which benefit from reduced energy rates—an obvious advantage in an industry where profitability hinges on power costs.

The result is effectively two mining economies: small operators running rigs at home or in workshops, attempting to stay invisible, and state-linked actors with access to cheaper electricity, larger facilities, and more predictable protection.

Authorities have periodically blamed illegal neighborhood miners, but some experts see that focus as a way to deflect attention from deeper problems of grid management and governance.

Where the cheapest power is concentrated in privileged institutions and enforcement is uneven, the largest rents accrue not to households plugging in a single machine, but to organized actors with access.

Iran has become a cutting-edge battlefield of monetary adaptation. The central bank experiments with stablecoins to stabilize the rial, while households use the same rails to escape it.

A tightly capped, KYC-only micro-saver lane could offer households limited protection for modest savings while increasing transparency and helping isolate state-connected networks operating at scale.

The unresolved question is whether regulated crypto channels can be structured to distinguish household self-preservation from state-linked finance—or whether policy choices will continue to push both into the same shadows.

Whether the state and its beleaguered citizenry can defy mounting economic pressure may hang in the balance.

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