Iranian Rial collapse, 2,000 deaths, why are the people collectively rushing to Bitcoin

When a country's monetary system completely fails and protests escalate into bloodshed, what choices do the people make? Iran has provided an answer: turning to Bitcoin. According to the latest news, Iranians are accelerating the transfer of Bitcoin from exchanges to personal wallets. This not only reflects an economic crisis but also reveals the true value of crypto assets in extreme environments.

A True Reflection of the Economic Crisis

The collapse of the rial is happening faster than imaginable. According to relevant information, the exchange rate of the Iranian rial to the US dollar has plummeted to 1,470,000:1, meaning that with just $879, one can become a “millionaire” in Iran. Even more shocking is that the wealth of Iranian citizens has shrunk by 99% over the past 15 years.

This is not just a numbers game but a real-life despair. When a country's fiat system fails, savings turn into worthless paper, and ordinary families face a complete collapse of purchasing power. In such a context, any asset that can preserve value becomes a lifeline.

On-Chain Data Demonstrates a Major Shift

Data from blockchain intelligence firm Chainalysis more intuitively shows the scale of this migration. From December 28, 2025, to January 8, 2026, there was a noticeable change in on-chain activity related to Iran. Especially after Iran experienced widespread internet outages in early January, the daily inflow of Bitcoin into personal wallets increased significantly.

What does this mean? The public is not only buying Bitcoin but more importantly, transferring Bitcoin out of exchanges and storing it in wallets they control. This behavior reflects a deep psychological shift: from speculative trading to asset preservation.

Chainalysis points out that this trend is a regular phenomenon worldwide. During times of war, economic turmoil, or heavy regulation, an increase in Bitcoin withdrawals always accompanies it. For Iranians, Bitcoin is becoming a “financial buffer,” providing a relatively controllable liquidity option in restricted environments.

The Changing Role of Bitcoin

It is worth noting that the role of Bitcoin in Iran is evolving. From initially being seen as a speculative asset, it has now become a store of value and an economic hedge in the eyes of some citizens. This shift reflects the practical value of crypto assets during real economic crises.

When fiat currency fails and banking systems are untrustworthy, Bitcoin's decentralized nature is no longer just a theoretical advantage but a practical necessity. People can bypass restricted financial systems to hold and transfer assets directly.

However, economist Peter Schiff has expressed a different view. He believes that in Iran's currency crisis, cryptocurrencies backed by gold should be preferred over Bitcoin, arguing that Bitcoin “has no physical backing.” While this perspective has some logic, it clearly did not prevent Iranians from making their actual choices.

A More Complex Background

Iran's crypto ecosystem is far more complex than it appears. According to reports, the Islamic Revolutionary Guard Corps (IRGC) holds a significant position in the country's crypto scene. It is estimated that by Q4 2025, related on-chain activities will account for about 50% of Iran's overall crypto market.

This means Iran's crypto market is not only a tool for citizens to hedge risks but also a channel for government asset allocation. The size of Iran's crypto ecosystem exceeded $7.78 billion in 2025, with a growth rate significantly faster than the previous year. This growth reflects both public demand and official participation.

Geopolitical Tensions Amplify

What’s more concerning is that Iran's situation continues to worsen. According to relevant reports, the number of deaths in nationwide protests has surpassed 2,000. The U.S. is moving aircraft carrier strike groups to the Middle East, and market forecasts have increased the probability of U.S. military strikes on Iran to 70-78%. In this geopolitical escalation, Bitcoin's appeal as a safe haven asset is expected to rise further.

Summary

The large-scale migration of Iranians to Bitcoin is essentially a reflection of economic despair. When the rial fails, protests escalate, and geopolitical tensions rise, Bitcoin shifts from a speculative asset to a survival tool. On-chain data confirms this, and people's actions are more convincing than any propaganda.

This case also reminds us that the true value of crypto assets often only becomes apparent in extreme environments. For Iranians, Bitcoin is not a get-rich-quick dream but their last resort to protect themselves amid economic collapse. If geopolitical tensions continue to escalate, this safe-haven demand could further boost Bitcoin's demand.