Image: Reuters

Prominent bitcoin advocate Max Keiser made a very bold prediction about a “global hash war” between the US and sanctions-ravaged Iran that is looking more realistic every day.

The host of RT’s Keiser Report told his viewers in July 2020 that bitcoin will soar to $500,000 because the US will start a war with Iran and Venezuela – of the hash-rate rather than the military variety – that plays out according to game theory.

He told his viewers: “Iran has already got 3% of global hash rate, so now I think Venezuela will get 3%-5% pretty quickly. And then at some point America will say, ‘We’ve got to enter the 21st-century space race of mining bitcoin,’ and then they’ll try to seek 20% of the hash rate, and then security goes up dramatically, and the price goes to $400,000, $500,000.”

Bitcoin’s price was under $10,000 at the time but has since soared to nearly $59,000, far higher than most analysts expected in such a short period of time, which has paved the way for wildly optimistic price targets in some quarters of $1 million and even higher.

Shield against US dollar weaponization

Now it looks like Iran, forced into action by Washington’s weaponization of the US dollar, could be pondering its next move in the growing global competition for bitcoin mining supremacy.

An Iranian think tank has called for the financially isolated Islamic republic to mine cryptocurrency in order to help sustain its economy, according to Iran Wire.

A report by the Iranian Presidential Center for Strategic Studies, which is associated with the office of President Hassan Rouhani, states that “cryptocurrency extraction” could be beneficial for various sectors of the beleaguered economy.

Mining could generate $2 million a day in revenue, while transaction fees could generate $22 million, according to the think tank. 

“If large mining farms are established, the need to employ manpower for monitoring and repair, security, electrical engineers, and technical staff related to hardware and software equipment will increase, which leads to more job opportunities in other sectors,” the report states.

Crucially, mining bitcoin could enable the country to circumvent Washington’s overtly sadistic sanctions, which have had a devastating impact on ordinary citizens, particularly sick people who are denied access to life-saving drugs.

“As the newly extracted bitcoins are not easily traceable, despite the pressure of sanctions on the country, domestic economic actors can use newly-extracted cryptocurrencies, which are preferable to existing bitcoins, on international exchanges,” says the report.

As Asia Times reported on October 30, Iran became the first country in the world to adopt bitcoin at a state level for value exchange when it changed legislation in order to redirect privately mined crypto into the Central Bank of Iran’s funding mechanisms for imports.

How the US will respond to Iran’s increasing adoption of bitcoin as a means of freeing itself of Washington’s stranglehold on the global financial system remains to be seen. What is clear is that the Biden administration’s nomination of Gary Gensler, a crypto-friendly MIT professor, as head of the Securities and Exchange Commission indicates that positive engagement with the nascent sector, including facilitating mining, may be on the horizon.

Keiser, who has been imploring everyone who will listen to buy bitcoin since it was $1, has no doubts about how the situation will play out. He tweeted, “As predicted… HASH WARS NOW!!”

Read: Global hash war ‘will send bitcoin to $500K’