Iran Crypto Volume Hits $7.8B as Rial Collapses; IRGC Seizes 50% Market Share

Iran’s cryptocurrency economy swelled to nearly $7.8 billion in 2025, a desperate flight to safety as the Iranian rial (IRR) evaporated to a record low of 1.42 million against the U.S. dollar. While Bitcoin held the $96,000 level, on-chain data reveals a bifurcated economy: citizens moving capital into self-custody to survive hyperinflation, and the Islamic Revolutionary Guard Corps (IRGC) capturing half the market to evade sanctions.

Currency Capitulation Drives Flight to Safety

The rial has effectively ceased to function as a store of value, losing over 40% of its purchasing power since June 2025. In response, volume on local exchanges didn’t just spike; it left the system. According to a report by Chainalysis, withdrawals to unattributed personal Bitcoin wallets surged in late December. This specifically correlates with the regime’s imposition of nationwide internet blackouts, a standard countermeasure during unrest that killed at least 2,400 protesters.

“Most telling is the surge in withdrawals from Iranian exchanges to unattributed personal Bitcoin wallets. This behavior represents a rational response to the collapse of the Iranian rial.” . Chainalysis Team

The liquidity drain is absolute. With inflation running between 40-50%, the premium for USDT and BTC on Tehran’s street markets has decoupled from global spot prices, creating isolated arbitrage loops that only the most connected brokers can exploit.

The Regime’s Shadow Economy

While citizens bought Bitcoin to preserve life savings, the state bought it to preserve power. Addresses associated with the IRGC received over $3 billion in 2025, up from $2 billion the prior year. By the fourth quarter of 2025, these sanctioned entities accounted for more than 50% of Iran’s total on-chain volume.

This is not organic adoption; it is state-level weaponization of liquidity. The IRGC is utilizing the same rails as the protesters to bypass the very sanctions designed to defund them, effectively creating a shadow banking layer that Western regulators are struggling to map in real-time. The $1 billion surge in IRGC flows signals a pivot from traditional shell companies to on-chain settlement for illicit oil and arms trade.

Market Outlook

The divergence is clear. For the Iranian populace, crypto is now a survival mechanism in a failing state. For the regime, it is a critical infrastructure for sanctions evasion. With the rial in freefall and internet access weaponized, the premium on censorship-resistant assets like Bitcoin will likely widen further within Iranian borders, regardless of global price action.