The Role of Bitcoin in Iran's Economic Turmoil

With increasing unrest in Iran, Bitcoin (BTC) has emerged as a significant alternative for many citizens, as highlighted by a new report from Chainalysis. The cryptocurrency ecosystem in Iran surged past $7.78 billion in 2025 amid ongoing challenges.

Key Takeaways:

Bitcoin has become a crucial alternative for Iranians amidst economic challenges and protests.
The Iranian rial has suffered massive devaluation, prompting increased Bitcoin usage for wealth preservation.
Crypto activities, especially withdrawals, have surged significantly during the ongoing crisis.
Iran's cryptocurrency market is growing rapidly, driven by both general citizens and state-linked organizations.

Escalating Bitcoin Usage in response to Iran's Economic Crisis

Since late December 2025, widespread protests have erupted in Iran, triggered by soaring inflation and the rapid decline of the local currency against the US dollar.

According to the US-based Human Rights Activists News Agency (HRANA), more than 2,500 individuals have lost their lives in these protests, and internet access has been cut off by authorities to control the unrest.

In the midst of this chaos, Chainalysis has reported a notable increase in cryptocurrency activity. There has been a significant rise in the average daily dollar amount transacted and a marked increase in transfers to personal wallets.

For withdrawals under $10,000, the growth has been remarkable, with a 236% increase in the average dollar value withdrawn and a 262% rise in the number of transfers. For withdrawals under $1,000, the dollar amount grew by 228%, with transfer numbers increasing by 123%. Withdrawals of larger sums, under $100,000, also saw a boost, with dollar amounts rising by 32% and transfers by 55%. Even for small withdrawals under $100, the average value increased by 111%, and transfers grew by 78%. There has also been a significant uptick in the movement of funds from Iranian exchanges to personal wallets without attribution.

As Chainalysis noted, “This behavior represents a rational response to the collapse of the Iranian rial, which has lost nearly all of its value, rendering it effectively worthless against major currencies like the euro.” As a result, Bitcoin's value has surged by 2,653% in Iranian rials due to this monetary collapse.

Bitcoin as a Form of Resistance

For those who have invested in Bitcoin, their wealth has been largely preserved, while those who remained faithful to the local currency have seen their assets plummet by 96%. As one observer noted, “Everyone deserves money their government can't destroy.”

Chainalysis emphasizes that Bitcoin is transcending its role as just a value holder; it has become a symbol of resistance for many Iranians. Unlike traditional assets, which can be subject to state control and lack liquidity, the decentralized nature of Bitcoin allows individuals greater financial freedom and mobility.

This flexibility is crucial for those who may need to leave Iran or depend on financial systems that operate independently of government oversight. Chainalysis added, “This pattern of increased BTC withdrawals during times of heightened instability reflects a global trend we’ve observed in other regions experiencing war, economic turmoil, or government crackdowns.”

The Growing Cryptocurrency Ecosystem in Iran

By 2025, Iran's cryptocurrency market has seen significant growth, reaching over $7.78 billion—a stark increase from previous years. Chainalysis attributes this surge to the pattern of crypto activity rising during pivotal events affecting the nation.

Noteworthy spikes have been recorded during incidents like the Kerman bombings in January 2024, missile strikes against Israel in October 2024, and the 12-day war in June 2025, which included assaults on the nation’s major cryptocurrency exchange and a key banking institution.

The Islamic Revolutionary Guard Corps (IRGC) has become a major player in this evolving market, with IRGC-affiliated crypto activities accounting for about half of the total crypto value received in Iran during the fourth quarter of 2025. The report estimates that IRGC-linked wallets received upwards of $3 billion in 2025, a rise from over $2 billion the year before. They have increasingly utilized digital assets to bypass sanctions and fund their operations.

Chainalysis noted, “We expect this figure to rise as more IRGC-affiliated wallets become publicly identified, revealing larger segments of their laundering activities.”

Hence, the dual nature of cryptocurrency adoption in Iran is evident. While state-affiliated actors leverage these digital assets for circumventing sanctions, ordinary citizens utilize them to safeguard their savings from rampant inflation and the potential risk of asset seizure. As economic conditions continue to pressure Iranians, cryptocurrencies are poised to remain an essential resource for those seeking greater financial independence.