## Cryptocurrencies as an International Trade Payment Method: Iran's New Attempt in Military Exports

Iran is exploring the use of cryptocurrencies as an alternative payment method for military goods transactions. The Iran Ministry of Defense Export Center (Mindex) website recently updated its FAQ section, indicating that "cryptocurrencies agreed upon in the contract" can be accepted as a payment option for purchasing military equipment. This move reflects Iran's ongoing efforts to diversify trade settlement methods amid long-term international sanctions.

## Why Iran is Turning to Cryptocurrencies

Facing sanctions from the US, UK, France, Germany, and others, Iran has established cryptocurrencies as an important tool for cross-border trade. According to Andrew Freedman, head of the Chainalysis National Security Department, cryptocurrencies have become an alternative payment channel facilitating cross-border transactions and remittances.

The Iranian Islamic Revolutionary Guard Corps (IRGC) and its proxy networks have recently expanded the use of cryptocurrencies for fund transfers, illegal oil sales, military procurement, and commodity trade. According to traceable data, the total scale of such transactions has exceeded $2 billion. Freedman further noted that organizations like Hezbollah, Hamas, and Houthi militants are using cryptocurrencies on an unprecedented scale.

## How the Mindex Platform Operates in Practice

Although Iran publicly claims to accept cryptocurrency payments, experts doubt the platform's practicality as a real trading venue. Ali Redbod of security research firm TRM Labs conducted a detailed analysis of the platform's actual functions.

He pointed out that the Mindex website lacks typical e-commerce features—no shopping cart, checkout process, order confirmation, or integrated payment infrastructure. Visitors do not see a "Buy" option when clicking on products; they can only click "Add to Letter of Intent." This action redirects to a form requesting personal information, nationality, company name, contact details, and referral source. The entire process does not require any payment information.

Products listed on the site include missiles, aircraft, tanks, ships, as well as various weapons, ammunition, data processing services, and communication equipment. However, these product pages lack prices, stock quantities, delivery schedules, or logistics details. Missing as well are cryptocurrency wallets, public keys, smart contracts, or blockchain settlement tracks.

## Legal Statements and Practical Implications of Payment Methods

Redbod emphasized that cryptocurrencies on the Mindex website are only mentioned as a possible settlement method "agreed upon in the contract," alongside barter and other negotiated terms. This phrasing indicates that cryptocurrency payments are not an automatic option for transactions but may be adopted on a case-by-case basis during negotiations.

He believes Mindex functions more like an "information collection and signaling mechanism" rather than an online store with genuine "cryptographic functions." The transfer of strategic weapons typically involves complex political processes, including licensing approval, end-user guarantees, compliance reviews, logistics arrangements, training support, and long-term logistics—things unlikely to be completed through simple website interactions.

## The Paradox of Cryptocurrency and Regulatory Transparency

Despite Iran and its proxy forces investing heavily in cryptocurrency transactions, these activities actually enhance law enforcement tracking capabilities. In September last year, the US Treasury Department's Office of Foreign Assets Control (OFAC) accused two Iranians and a shell company network based in Hong Kong and the UAE of engaging in cryptocurrency transactions to launder approximately $100 million from oil sales. These funds ultimately flowed to the IRGC's special forces branch, Al-Quds Force, and Iran's Ministry of Defense and Logistics Support.

Freedman from Chainalysis stated that this complex network spanning multiple jurisdictions, utilizing both traditional shell companies and cryptocurrencies, highlights the sophistication of modern sanctions evasion schemes. However, the transparency inherent in blockchain technology also provides law enforcement with unprecedented means to identify and dismantle complex sanctions evasion networks involving hundreds of millions of dollars.

## Summary

Iran's opening of cryptocurrencies as a payment option on the Mindex platform is more symbolic than a real shift in military trade structure. In reality, strategic military transfers will continue primarily through traditional diplomatic channels. Nonetheless, the use of cryptocurrencies to evade international sanctions is accelerating, posing ongoing challenges to the global financial regulatory system.