Iran's Bitcoin Adoption Surges Amid Economic Collapse and Civil Unrest

Economic Crisis Drives Citizens to Bitcoin

Iran's cryptocurrency ecosystem reached $7.78 billion in transaction volume during 2025, accelerating significantly amid nationwide protests and continued economic deterioration, according to blockchain analytics firm Chainalysis ^[1][2].

Mass demonstrations erupted around December 28 over deteriorating economic conditions as the Iranian rial hit record lows against the US dollar ^[1]. The protests escalated nationwide, with Iran's regime responding by cutting internet access, conducting mass arrests, and reportedly killing thousands ^[1].

During this period of unrest, Chainalysis observed substantial increases in both the number of daily cryptocurrency transfers and the amounts transacted ^[1]. Most notably, data showed a sharp surge in withdrawals from Iranian exchanges to unattributed personal Bitcoin wallets ^[1][2].

Bitcoin as Financial Refuge

Comparing activity before protests began with the period leading up to Iran's nationwide internet blackout on January 8, researchers identified pronounced spikes in transaction volumes and transfers to self-custodied Bitcoin wallets ^[2]. This pattern suggests Iranians are taking possession of Bitcoin at markedly higher rates during protests than beforehand ^[1].

The 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 ^[1]. Since 2018, the rial has lost roughly 90% of its value, with inflation running between 40% and 50% ^[2].

According to Chainalysis, Bitcoin's role during the unrest extends beyond capital preservation, becoming "an element of resistance, providing liquidity and optionality in an increasingly restricted economic environment" ^[1]. Unlike traditional assets that are illiquid and often subject to government control, Bitcoin's censorship-resistant and self-custodial nature offers financial flexibility, particularly valuable when individuals may need to flee or operate outside government-controlled financial channels ^[1].

IRGC Dominates Crypto Ecosystem

While ordinary citizens seek financial refuge in cryptocurrency, Iran's government has also turned to digital assets. The Islamic Revolutionary Guard Corps' crypto activity accounted for approximately half of the total crypto ecosystem in the fourth quarter of 2025 ^[1][2].

IRGC-associated addresses received more than $3 billion in total during 2025, up from over $2 billion in 2024 ^[1][2]. Chainalysis noted this figure represents a lower-bound estimate, based only on wallets publicly identified through sanctions designations by the U.S. Treasury's OFAC and Israel's National Bureau for Counter Terror Financing ^[2].

These networks span multiple countries and are used to move illicit oil revenues, launder funds, evade sanctions, and finance Iran's regional proxy groups ^[2].

Crisis-Driven Adoption Pattern

Blockchain data reveals that crypto activity in Iran closely correlates with major political shocks, regional conflict, and domestic unrest, making it a real-time barometer of instability inside the country ^[2]. The report identified pronounced spikes following several major events, including the January 2024 Kerman bombings that killed nearly 100 people, Iran's October 2024 missile strikes against Israel, and a 12-day war in June 2025 ^[2].

TRM Labs tracked roughly $3.7 billion in total crypto flows in Iran between January and July 2025 ^[1]. Approximately seven million people out of the country's 92 million population are estimated to be crypto users, according to Statista ^[1].

Chainalysis concluded that cryptocurrency is playing a dual role in Iran: serving as a financial escape valve for citizens while functioning as a sanctions-evasion tool for the state and its security apparatus ^[2]. The team noted that similar patterns of increased Bitcoin withdrawals during times of instability have been observed in other regions experiencing war, economic turmoil, or government crackdowns ^[1].

"As sanctions pressure and international opprobrium intensify, and Iran's economic volatility persists, cryptocurrency will likely remain a crucial tool for Iranians seeking financial sovereignty," the Chainalysis team stated ^[1].