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Iran Protests Over Rial Collapse: Bitcoin’s Role in Safeguarding Savings

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Iran Protests Over Rial Collapse: Bitcoin’s Role in Safeguarding Savings

Key Takeaways

  • 1 Mass protests erupted in Tehran after the Iranian rial hit a record low against the dollar.
  • 2 Since June, the rial lost over 40% of its purchasing power, trading near 1.4 million per dollar; in the early 1980s, the official rate was 70 per dollar.
  • 3 Central Bank Governor Mohammad Reza Farzin resigned amid the protests.
  • 4 Bitwise CEO Hunter Horsley proposed Bitcoin as a way to protect savings from currency devaluation.
  • 5 Bitcoin mining in Iran is heavily regulated, with estimated mining costs around $1,300 per BTC; banking issues and a hack of the Nobitex exchange have also posed challenges.

Mass protests in Tehran follow the rial’s 40% drop and 1.4M per dollar rate. Bitwise CEO suggests Bitcoin as a hedge to protect savings amid economic turmoil.

Mass protests took place in Tehran after the Iranian rial reached a record low against the US dollar. Locals blame the Central Bank’s policies, which faced severe criticism and led to the resignation of its governor, Mohammad Reza Farzin. Amid the loss of purchasing power, people are looking for alternative ways to preserve capital, and in this context, Bitwise CEO Hunter Horsley named Bitcoin as a potential tool for safeguarding savings.

Causes of the Protests in Iran

The main cause of the protests is the sharp decline in the rial’s value: the currency has lost more than 40% of its purchasing power since June and trades at about 1.4 million rials per dollar. This devaluation has eroded many families’ savings and intensified dissatisfaction with economic policies. The situation worsened with the resignation of Central Bank Governor Mohammad Reza Farzin, adding uncertainty to the country’s financial management.

Bitcoin’s Role in Protecting Savings

According to Hunter Horsley from Bitwise, Bitcoin is viewed as one way to protect against rapid national currency devaluation: in times of severe depreciation, the digital asset offers an alternative store of value. However, in Iran, access to cryptocurrencies and self-custody rules remain unclear, while mining is under strict government control. The role of BTC in international currency relations is also discussed in other materials; see the article on Bitcoin’s impact on the dollar for additional perspective.

Regulation of Bitcoin Mining in Iran

The Iranian government actively combats unauthorized mining and even encourages reporting neighbors as part of the crackdown on illegal farms. At the same time, cheap electricity theoretically results in low mining costs: estimates put the cost of mining one BTC at around $1,300. However, unclear rules on crypto asset custody and strict mining regulations limit the population’s ability to fully leverage these advantages.

  • Government measures against unregistered mining;
  • Low operational costs for mining (around $1,300 per BTC as of October estimates);
  • Ambiguous self-custody regulations for private individuals.

Economic Challenges in Iran

Beyond currency devaluation, systemic risks have accumulated in the economy: in October, the state-owned Bank Melli was declared bankrupt, jeopardizing the assets of over 42 million Iranians. The Central Bank also warned that eight other banks risk liquidation if reforms are not implemented. Additionally, the Iranian crypto exchange Nobitex suffered a hacker attack resulting in losses of $81 million, exacerbating risks for crypto market users.

Why This Matters

If you mine in Russia, events in Iran do not directly change the technical setup of your farm, but they illustrate the risks people face amid sharp currency devaluation and weak banking asset protection. It’s important to understand that when the banking system and national currency are under pressure, the need for reliable stores of value grows, influencing demand and discussion around cryptocurrencies as a "safe haven." At the same time, strict national restrictions and cyberattack risks show that access to services and operational security remain critical factors.

What to Do?

  • Verify and strengthen private key storage: use cold wallets and keep backups in secure locations.
  • Assess risks of exchanges and centralized services: major hacks (like the $81 million breach in Iran) highlight the importance of choosing reliable platforms.
  • Monitor regulatory signals and news: changes in mining rules or banking systems can indirectly affect BTC liquidity and usability.
  • Optimize mining operational costs: regularly review electricity rates and equipment efficiency, especially for smaller farms.
  • Diversify value storage approaches: combine crypto self-custody with other security measures and consider local risks.

For a deeper understanding of Bitcoin’s long-term profitability and expert opinions, Bitwise’s material reviews 10-year forecasts and yield estimates — a useful starting point for planning storage and mining strategies. More details at Bitcoin profitability.

Frequently Asked Questions

Why did protests start in Iran?

The protests were triggered by the sharp devaluation of the Iranian rial: the currency lost over 40% of its purchasing power since June and trades near 1.4 million rials per dollar. This sparked public dissatisfaction with economic policies and leadership at the central bank.

What did the Bitwise CEO say about Bitcoin?

Hunter Horsley from Bitwise suggested considering Bitcoin as a way to protect savings from the rapid decline in the national currency’s value.

Is Bitcoin mining profitable in Iran?

Economically, mining costs in Iran are estimated at about $1,300 per BTC due to cheap electricity; however, strict government regulations and regulatory risks complicate scaling mining operations.

What other issues affect Iran’s financial stability?

Besides rial devaluation, Iran faces the bankruptcy of Bank Melli, the threat of liquidation for several banks, and major cyberattacks on crypto exchanges, such as the $81 million Nobitex hack.