Lede
The Central Bank of Iran (CBI) has reportedly acquired more than half a billion dollars worth of Tether’s USDt, as detailed in a report by the blockchain analytics platform Elliptic. According to the findings, the central bank held approximately $507 million in the US dollar-pegged stablecoin issued by Tether. The accumulation of these digital assets began in earnest during a period of extreme economic volatility for the nation. It is indicated that the stablecoins were used specifically to prop up the country’s fiat currency, the rial, which has faced significant downward pressure.
According to Elliptic, the bank likely utilized these digital assets to address the ongoing collapse of the Iranian rial or to facilitate the settlement of international trade. The central bank may have attempted to stem the currency’s decline by purchasing rials with USDt on local exchanges. This strategy effectively allowed the CBI to perform open market operations using cryptoassets, functions that would typically be conducted using traditional cash reserves. By integrating USDt into its financial strategy, the CBI sought to manage liquidity and maintain trade capabilities during a challenging economic period.
Context
The economic background for the central bank’s move into digital assets was characterized by severe currency devaluation. The value of the Iranian rial had halved in a period of just eight months, hitting a record low against the dollar at that time. To facilitate its cryptocurrency operations, the Central Bank of Iran relied on Nobitex, which is recognized as one of the largest digital asset exchanges in Iran. Nobitex was responsible for handling the central bank’s USDt holdings and transactions through the first half of 2025.
However, this arrangement was disrupted in June 2025 when Nobitex suffered a significant security breach. Following the incident, the CBI’s strategy regarding its digital assets underwent a notable shift. Elliptic reported that the bank began sending its USDt to a cross-chain bridge service. This was done to move the funds from the TRON network to the Ethereum blockchain. Subsequently, the assets were exchanged for other digital tokens and transferred to various other blockchains and exchanges. This transition highlights the complexities the central bank faced in managing its digital reserves while navigating security risks and the need for cross-chain interoperability.
Impact
The use of Tether’s stablecoin by a state entity like the CBI has brought focus to the control mechanisms available to private issuers. Elliptic noted that Tether likely maintains the ability to freeze accounts holding USDt, a power that has significant implications for state-level users. This capability was exercised in June 2025 when several digital wallets linked to the Central Bank of Iran were blacklisted. As a result of this action, approximately $37 million worth of USDt was frozen within those specific accounts.
The freezing of these funds illustrates the potential risks for governments using centralized stablecoins as part of their national reserve or trade settlement strategies. While the CBI attempted to diversify its holdings across different blockchains and use bridge services to obfuscate its movements, the initial reliance on USDt left a portion of its assets vulnerable to issuer intervention. The incident in June 2025 served as a clear demonstration of how private sector enforcement can impact the financial operations of a national central bank within the digital asset space, potentially limiting the effectiveness of crypto-based open market operations.
Outlook
Despite the challenges faced by the central bank, the broader adoption of digital assets within the country has shown a significant upward trend. Chainalysis reported that the nation’s crypto ecosystem surged to a total value of more than $7.8 billion in 2025. This growth is driven not only by institutional activities but also by the local population. Many residents are increasingly turning to digital assets such as Bitcoin (BTC) as a safe haven to protect their personal wealth from the effects of economic instability and high inflation.
The continued surge in usage suggests that the role of cryptocurrencies in the national economy is expanding. As locals look for alternatives to the volatile rial, digital assets provide a perceived layer of protection against the devaluation of the national currency. While the central bank navigates the difficulties of asset freezes and exchange security, the wider ecosystem appears to be maturing, with a multi-billion dollar valuation reflecting a shift in how financial value is managed and stored in the region. The move toward assets like Bitcoin by the public indicates a growing lack of confidence in traditional fiat systems amidst ongoing economic pressures.
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