Iran has seen a rise in stablecoin usage as its currency continues its steep decline this week as it dropped to trading at 1.42 million against the United States dollar before recovering slightly to around 1.38 million. The collapse erased household savings and pushed the prices of essential goods higher. According to reports, inflation rose to 42.2% year over year in December, while food prices and health-related costs climbed to 72% and 50%, respectively. The reports have worsened public frustration amid fears of hyperinflation. Demonstrations have expanded across several areas in Tehran and some major cities. Shopkeepers near the Grand Bazaar closed their stores and gathered in protest, adding their voices to the frustration of the masses. Stablecoin usage on the rise in Iran as rial plunges According to videos scattered online, there are several groups chanting against the ruling class, though authorities dispute the timelines around the footage. President Masoud Pezeshkian has also acknowledged the unrest, urging officials to move swiftly to tackle the issues that he describes as legitimate economic concerns. He has instructed the interior minister to engage directly with the leader of the protest. Parliament Speaker Mohammed Bagher Qalibaf has also called for urgent measures to protect the Iranian rial. He made the call while accusing foreign adversaries of taking advantage of the unrest. Despite these statements, footage has shown security forces deploying tear gas in some areas. Meanwhile, Iranians are now swiftly turning to cryptocurrencies and stablecoins as the rial continues to lose value. Most of them confirmed to have made the move to protect their purchasing power. Blockchain analysts have long tracked this trend in sanctioned economies, where access to traditional banking remains limited. Iranians are particularly gravitating towards stablecoins pegged to the United States dollar, as they see it as a practical hedge against local currency declines, especially during periods of instability and rapid devaluation cycles. The shift is also in line with Iran’s engagement with digital assets. According to earlier reports, Iran’s Ministry of Defense Export Center has signaled its intention to accept digital assets for payments for sales of arms overseas. Chainalysis also previously reported that sanctioned countries received more than $16 billion in digital assets in a single year, showing how digital assets and their underlying technology have been supporting cross-border transactions under pressure. Geopolitical tensions and economic turmoil The economic crisis has also caused a swift fallout as Central Bank Governor Mohammed Reza Farzin resigned on Monday, according to state media. Meanwhile, the renewed United Nations sanctions in 2025, which are tied to Iran’s nuclear program, have further restricted its access to three global markets, intensifying capital flight. Authorities have also announced temporary shutdowns across Tehran and other provinces, citing energy shortages and cold weather. Meanwhile, residents claim that despite the government shutdown, there has been a history of crypto firms tied to the administration carrying out energy-intensive mining operations . Geopolitical risks have resurfaced as the United States has warned Iran against any attempt to rebuild nuclear or missile capabilities. United States President Donald Trump has said that the United States would act again if Iran moved ahead to restore its nuclear program, though he noted that there could be a negotiated deal. Claim your free seat in an exclusive crypto trading community - limited to 1,000 members.
