The national currency of Iran, the rial, is expected to lose at least 56% of its value by the end of the year amidst a correction worse than that of bitcoin, and the holders of the Iranian rial are said to lose more than half of their savings stored in fiat.
Hyperinflation at 136%
Due to an amalgamation of a variety of factors including strict sanctions imposed by the U.S.A government on Iran, the national currency of the country has been on a massive decline since the beginning of the year.
Since it’s all-time high at around $19,500, the bitcoin price has fallen by some 70% replicating the correction it experienced in 2014. But, if the cryptocurrency market moves similarly to its correction in 2014, which was the worst correction in the history there – the price of major virtual assets like bitcoin and ethereum would bottom out at a 70 to 80% steep drop.
The Iranian rial also experienced a substantial drop in its value throughout the past six months; the drop of the rial’s value was not as intense as the correction of bitcoin, and while the main cryptocurrency is expected to recover from the $5,000 area, the value of the rial is expected to decline by 56% based on mathematical data and its hyperinflation rate at 136%
Moving From National Currencies to Crypto
This year, the U.S.A government strengthened its sanctions on Iran by preventing the country from transacting with financial institutions outside of the country. The now imposed control on Iran’s financial network led the value of the rial to plummet in price.
To avoid these sanctions, governments that oversee monetary systems that are not considered as reserve currencies could potentially utilize decentralized/public cryptocurrencies to transact money in the future.