Bitcoin Forum

The latest announcement by the US that it will withdraw from theIran nuclear deal has led to Iranians spending $2.5 billion on purchasing cryptocurrency. I attribute this to the fact that cryptocurrencies are the safest way of storing wealth. To me, those times are the best times to buy. What do you think about that?

According to these sanctions, any bank that deal with Iran, will be punished by United State's government. So, people need a decentralized currency without any middleman.

Just to get the fact cleared, the Iran government did not buy any cryptocurrency. Only the people associated with cryptocurrency in Iran deemed to have done it amidst the rising uncertainty after America left the nuclear agreement. They have probably done it to continue with their international transactions and business payments overseas. People are trusting cryptocurrency in their bad time, that is the only silver lining of the story.

Otherwise this is not at all a good news for the international politics. Especially Asian countries will face the heat because Iran majorly exports their petroleum to Asia and the oil price has started increasing already.

This is an old observation. Because people in the conflict regions doesn't have many options to keep or move their fortune, they are using gold, bitcoin or other tangible options.

It's not the safest, but it's one of most easiest for big amount of money. Like you could easily buy 2.5B in Bitcoin, but to buy a gold for 2.5B?

Yup. Economic sanctions increase demand for crypto.

I don't think it's the safest way of storing wealth considering its volatility. Buying up foreign currency and/or gold may still be the safest. Venezuela, for example, has a very active black market for USD and other foreign currencies. If Bitcoin was the number one option, and is also completely legal to boot, there should be no need to go underground, right?

That being said, I'm not at all surprised that lots of people consider it as an option. It's ridiculously easy to buy, sell, move, and store, so much so that all of that could be done using a single cellphone with an internet connection. It's starting to develop a reputation to shield against domestic instability too, as evidenced by Iranians buying up in anticipation of an economic collapse. It's not the safest, but it's pretty damn safe.

Didn't the US government restricted its banks to make dealings with Iran? And also, AFAIK the government itself isn't the one who bought bitcoins but rather its citizens who wished to still do dealing outside of their country. It's the only way in the mean time to continue transactions and to purchase whatever it is that's not available in their country. It could also be a means of storing wealth if you want to put it that way, though they can always buy gold which, I think for the mean time isn't accessible to them.

Buying bitcoin publicly from goverment? It's a shame, yes. US did a good job but they are very loyal, they don't try anything to make something difficult, just shit sanctions but in this situation I am amazed why they decided to do this.
Bitcoin is great for storingor wealth as you call it because if anything happens and your bank account or etc gots closed or you have loan, no one can touch your bitcoins.
Best time never exists in buying of bitcoin!

I'm sure that sanctions also include cryptocurrency transactions, so you can't just do business with Iran while using Bitcoin instead of banks and think that you've outsmarted the government. If you want to circumvent sanctions while operating in a country that have imposed them, you will be commiting a crime, and your only hope to avoid prosecution is to hide it, so you need cryptocurrencies with strong privacy and a way to launder your money. But this is a really risky thing to do and most likely not worth it, so businesses will just seek for other markets instead.

Wow, I thought you were bullshitting, but that's no joke. According to Yahoo Finance (https://finance.yahoo.com/news/ban-iranians-spend-2-5-110546297.html):

That's incredible. All these years we've been saying that Bitcoin/cryptocurrency is way too small for effective capital flight and sanction dodging. Times sure are changing! :o

Also from that article:

Although I wouldn't connect everything to sanctions and regional instability. I think Iranians were just participating in the 2017 speculative bubble like everyone else. Due to the banking ban, they had to use international exchanges, hence the capital flight.

While I understand this was precisely the reason of why satoshi created bitcoin to allow two individuals to transact with each other without any middleman, at the same time this kind of news make me nervous that governments are going to really try to enforce a ban against cryptocurrencies, this will not stop cryptocurrencies but many people out of fear are going to get out of the market, so this will decrease the price and the interest in cryptocurrencies in the short term, but over the long term this may have the good effect of increasing the price dramatically since getting bitcoin will be harder.