Based on a report by the Tehran Times, Iran is in talks with eight countries to use its state-backed cryptocurrency for transactions. The sanction-hit nation located in the Middle East met with counterparts from Germany, England, Austria, Bosnia, France, South Africa, Russia, and Switzerland.
Iran’s goal is to convince foreign investors that the country’s cryptocurrency is worth investing, based on information provided by Iran’s head of Trade Promotion Organization, Mohammed-Reza Modoudi.
Additionally, representatives talked about how the country would address it global trades while under international banking sanctions. The country’s response, of course, was Digital Rial.
Avoiding the US Dollar
The gathering between the countries happened when countries from the west began to look favorably on Iran. Most recently, a European Commission planned to establish a Special Purpose Vehicle to help countries in Europe move around sanctions imposed by the US.
France, Germany, and the UK all led efforts to completely remove the US dollar from the transaction. These countries all partner with the oil-rich nation to import natural gas into their own countries.
The meeting came after SWIFT was coerced by the Trump administration into severing ties with the central bank of Iran. Trump also suggested that US allies stop working with Iran. As a result, Iran’s gas, shipping, oil, and financial industries suffered severe setbacks.
However, now that the European Commission is making moves in support of Iran, the United States is now confronting its allies. One US Senator, Tom Cotton, suggested that these countries need to decide whether they want to partner with the United States or with Iran. “I hope our European allies choose wisely,” he said.
In an attempt to take advantage of growing uncertainty amongst western countries, Iran pitched its alternative to intergovernmental finance. This option would completely bypass the US dollar.
Countries Against US Sanctions
Iran fully expects its Crypto Rial to gain traction from nations also put under sanctions by the United States. Countries identified by the US as nations that might adopt Crypto Rial include Russia, Turkey, Venezuela, and China.
Russia has not been shy about its position regarding US sanctions as President Vladimir Putin has stated publicly that the country is working with Iran to create independent financial networks. Late last year Russia signed a bilateral blockchain agreement with Iran and Armenia.
These steps are reminiscent of the moves China made to establish itself as an economic power. When China announced that it would make internationalizing the Yuan a priority, the European central bank traded $611 million for the currency. While the exchange itself wasn’t large in terms of the global economy, it was still a sign that the US dollar doesn’t have the hegemony it once did.
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