Iranians are accumulating BTC and withdrawing it massively from local platforms to private wallets to take control of their funds in the face of censorship and internet shutdowns.
Massive Bitcoin Withdrawals to Private Wallets
Amid a wave of protests and acute economic crisis, more and more Iranians are withdrawing their BTC from exchange platforms to hold in personal wallets, showcasing Iran’s role as an extreme user of Bitcoin in times of instability.
Since the start of the protests in late December, triggered by worsening economic conditions and government repression, on-chain data shows a clear acceleration in Bitcoin withdrawals from local platforms to private wallets.
A report by Chainalysis reveals that this trend intensified between December 28 and January 8, a period that coincided with an internet blackout imposed by Iranian authorities. Analysts see this movement as a clear desire to take direct control of funds, bypassing intermediaries and potential censorship.
The Rial’s Collapse Drives Search for Safe Havens
The primary cause of this shift is the dramatic collapse of the national currency, the rial. In a matter of weeks, its exchange rate went from around 42 rials per dollar to over 1,050, eroding household purchasing power.
In this scenario, Bitcoin emerges as a logical hedge against hyperinflation. Its capped supply at 21 million units, international portability, and resistance to censorship make it an attractive tool for preserving value and liquidity, especially when access to the banking system is threatened or restricted.
Chainalysis describes this behavior as a “rational” response: when local currencies plummet and economic freedoms shrink, citizens turn to alternative, seizure-resistant forms of money.
A Pattern Seen Elsewhere
This phenomenon is not unique to Iran. Analysts note a similar pattern in other regions facing armed conflicts, financial crises, or authoritarian crackdowns. In such contexts, crypto flows often rise in tandem with political restrictions, with Bitcoin serving as a financial pressure valve.
When governments tighten the noose, individuals turn to cryptocurrencies.
Iranian Authorities Also Active in Crypto
Remarkably, crypto adoption is not limited to the population. Entities linked to the Iranian government also leverage this ecosystem. According to Chainalysis, addresses associated with the Islamic Revolutionary Guard Corps (IRGC) now represent over 50% of the total value of incoming crypto flows in Iran in the fourth quarter of 2025.
These wallets processed over $2 billion in on-chain transactions in that period alone, bringing the estimated annual total to around $3 billion, likely an underestimated figure as it only accounts for addresses already sanctioned by the United States and Israel.
Bitcoin: Citizen Tool and State Instrument
This dual dynamic underscores the ambivalence of Bitcoin in Iran. For part of the population, it signifies an economic survival tool and financial freedom. For some state actors, it also serves as a means to circumvent international sanctions and finance operations outside the traditional financial system.
In a country where the currency is collapsing and dissent is suppressed, Bitcoin emerges as a central player, both as an individual refuge and a geopolitical instrument, exposing the full political and economic impact of blockchain technology in times of crisis.
