It is not a secret that cryptocurrencies are harder to track than fiat currencies. This one of the primary reasons why such currencies became popular around the world. However, this emerging technology is also used for various illegal activities.
Consequently, authorities are trying to identify such individuals and organizations to limit such activities. There is another serious problem for the authorities. Countries that fell under U.S. sanctions are more and more actively using cryptocurrencies to evade the sanctions.
This topic is crucial for the future of cryptocurrencies.
On the one hand, this technology is so powerful that the U.S. considers cryptocurrency as a national security threat. On the other hand, cryptocurrencies could solve many issues.
U.S. sanctions, cryptocurrencies, and Belt & Road initiative
In the last two years as a result of U.S. sanctions, the Iranian economy declined by 10-20%. The country is trying to evade the U.S. sanctions, Iran started to use cryptocurrencies to minimize the damage caused by the sanctions.
It is important to mention that Bitcoin is the largest cryptocurrency when it comes to market capitalization. Iran is using this cryptocurrency as one of the solutions to move around the sanctions.
This Middle Eastern country is not alone when it comes to using cryptocurrencies to cope with the harsh impact of U.S. sanctions.
Venezuela is struggling to deal with economic problems. The country even created a state-backed digital currency called Petro.
China is working on national digital currency. It has the chance to become the first major superpower to launch a digital currency.
Interestingly, the “Belt & Road Initiative” may include a blockchain component with Ethereum.
Therefore, China will have the opportunity to trade with other BRI countries such as Russia and Iran, using digital assets. This way, countries will be able to evade U.S. sanctions.
However, such cases should derail the process of crypto adoption as governments should understand the importance of this technology.