Bitcoin, after steadily rising over the last few weeks, has suffered a sudden and sharp drop in most global markets and has lost more than 10% of its value over the last 24 hours.
But not, apparently, in Iran.
The Bitcoin slide that started on Wednesday – and has been seen in exchanges across the US, Europe and Asia – is, in part at least, being put down to panic selling caused by a report, from Business Insider, that said investment banking behemoth Goldman Sachs has “moved plans to open a desk for trading cryptocurrencies further down a list of priorities.”
Business Insider, quoting people “familiar with the matter” says Goldman has dropped its crypto-trading plans because of ongoing “uncertainty” in the regulatory landscape and will instead focus on rolling out a “custody product” that will see the bank hold Bitcoin and other crypto-currencies on behalf of large institutional clients so it can better manage rapid price changes.
Presumably exactly like the rapid price change currently being seen, perhaps on the back of the Goldman news. According to CNBC, Bitcoin sat under $6,300 in morning trading in Asia after trading between $7,000 and $7,500 for most of August.
Meanwhile, however, in trading in Tehran, Bitcoin is reportedly moving higher and higher as its national currency, the rial, hit a new record low against the US dollar as sanctions, from Donald Trump’s administration, hit Iran.
The country’s rial has been falling since Washington not just pulled out of the international Iranian nuclear framework agreement but also said it will penalize anyone that continues to does business with Iran.
Iran’s rial fell to a record low on Wednesday and, according to the New York Times, there is now “currency chaos” in the capital as essential products disappear from shop shelves and queues form all over the city as people try to change money.
The US dollar is the hard currency of choice but Bitcoin, reportedly, is also popular.
The ever-rapacious crypto-currency news sites are reporting that Bitcoin is currently trading at more than $20,000 with one, CryptoGlobe saying the price briefly hit $35,000 earlier today, which would make it a record global high.
This price surge was in part because of people moving money away from the collapsing national currency. But, it also comes straight after an announcement yesterday from the Central Bank of Iran that the country is going to formally recognize crypto-currency mining as an industry.
The announcement, that came via the Central Bank’s news agency, Ibena, also added that the planned launch of an Iranian national cryptocurrency “is promising and can be used as a financial transaction instrument with Iran’s trade partners and friend countries amid economic pressures through US sanctions.”
Iran first announced it would launch its own state-backed crypto in July.
“We are trying to prepare the grounds to use a domestic digital currency in the country… This currency would facilitate the transfer of money (to and from) anywhere in the world. Besides, it can help us at the time of sanctions,” Alireza Daliri, deputy for management and investment affairs at Directorate for Scientific and Technological Affairs of the Presidential Office told the nation’s official news channel, Press TV.
Iran is not the first country to attempt to launch a national crypto. Venezuela’s President Nicolas Maduro launched his Petro crypto coin in late 2017 and, again in the face of US sanctions and growing economic and social chaos, now says this digital coin is backing the country’s new hard currency, called the “sovereign bolivar.”
Maduro’s virtual coin has been criticised domestically and internationally as a scam, with Venezuelan economist Luis Vicente León saying that “anchoring the bolivar to the Petro is anchoring it to nothing.”
Iran is, of course, very different from Venezuela and what happens next in Tehran is right now hard to gauge. But the fact that the words Goldman, Iran, Venezuela, Trump and Bitcoin are all linked here sure says something about the times we are living in.