Recently, Iran has once again become a focal point of attention. Against the backdrop of nationwide protests, the Iranian government implemented extensive internet and communication restrictions on the evening of January 8. That night, Iran's external internet connectivity dropped significantly within a few hours, and mobile data and fixed broadband services were disrupted in most areas.
Against this backdrop, the demand for external communication methods and non-traditional financial tools has risen simultaneously. On one hand, satellite internet services, represented by Starlink from Musk, have been used in some areas to restore limited external connectivity. On the other hand, in the context of the local currency continuously weakening against international currencies, cryptocurrency assets such as USDT have been used for daily life purposes, and even for military applications.
Meanwhile, regional geopolitical tensions have intensified, further exacerbating Iran's monetary pressures. The exchange rate of the US dollar against the Iranian rial has fallen to a historic low in the free market, indicating a deepening currency crisis in Iran. In the following analysis, the CoinW Research Institute will examine this event in detail.
I. The Starlink Game: The Suppressed Digital Gateway
Starlink Becomes a Fleeting Digital Window
On January 8, within the first few hours after the nationwide internet shutdown in Iran, this lifeline was briefly reactivated. A small number of users who could still access the external internet through Starlink became channels for information to get out. Iranian citizens raced against time to upload on-site videos and text records, which were then disseminated through social media platforms like Telegram.
At this stage, Starlink has hundreds of thousands of users, who are highly dispersed. With conventional communications completely paralyzed, Starlink has become a crucial channel for sending out these messages. An increasing number of voices are calling on Musk to strengthen Starlink's support for Iran. However, the practical constraints are equally clear: without a sufficient number of ground terminals, all satellite coverage remains nothing more than a castle in the air.
Escalation of Electronic Warfare: GPS Jamming and Encirclement
However, this faint digital signal was soon met with systematic suppression. The Iranian military quickly deployed military-grade electronic warfare equipment to conduct high-intensity, large-scale interference against the Starlink satellite signals, causing the connection stability of Starlink terminals to plummet sharply.
Starlink's operation heavily relies on GPS signals for satellite positioning and time synchronization. Originally intended for countering drones during wartime, Iran's GPS jamming techniques have now been directly repurposed to suppress satellite internet. On the first day of the internet disruption, Starlink's network experienced an average packet loss rate of 30%, with some areas reaching as high as 80%, making it nearly unusable. Although this interference cannot achieve complete coverage nationwide, it has been sufficient to significantly disrupt Starlink's operations across large parts of Iran for the first time.
The Iranian authorities also simultaneously launched systematic strikes at both legal and physical levels. During the internet blackout, security forces intensified efforts to search for satellite terminals. Drones were used to patrol rooftops, focusing on the distinctive disc-shaped antennas of Starlink; electronic jamming was directed at residential areas suspected of having terminals, using high-intensity noise to block specific frequency bands.
In this high-pressure environment, people who still attempt to use Starlink have to adopt extreme evasive strategies. Some try to hide their communication patterns through multiple layers of VPNs, while others constantly move their antenna locations, shorten their device's online duration, and only briefly connect during the深夜 (late night).
Iranian authorities are also preparing for a prolonged standoff. On one hand, they are implementing a whitelist internet access mechanism, allowing only government-approved institutions to restore limited connectivity. On the other hand, they are accelerating the development of a "National Intranet" system, permanently isolating the public from the global internet.
II. Cryptocurrencies: A Safe Haven Amid the Collapse of Local Currencies
Internet censorship not only created an information vacuum but also quickly impacted Iran's already fragile financial system. Against the backdrop of intermittent banking service disruptions, restricted cash flow, and the continuous devaluation of the rial, cryptocurrencies have become a fundamental medium of exchange, especially the stablecoin USDT.
withUSDTStablecoins, represented by USDT, have shown a clear duality within Iran's economic system. On one hand, residents use them for risk hedging, to protect against inflation and alleviate uncertainties caused by restrictions on the financial system. On the other hand, stablecoins are also used for military-related fund flows, playing a role in circumventing sanctions in specific scenarios.
At the civilian level, stablecoins serve as a safe-haven asset.
From a civilian perspective, the prolonged depreciation of the rial has continuously eroded residents' purchasing power. Under conditions where access to foreign exchange is limited and the international settlement system is difficult to reach, many people have gradually shifted their savings from the local currency to stablecoins like the U.S. dollar. Among these, USDT issued on the Tron network is particularly widespread in Iran due to its low transaction fees, fast transfer speeds, and strong liquidity. USDT is widely used for inflation-hedging savings, off-exchange transaction settlements, and even in some daily payment scenarios.
This trend was further amplified during periods of social instability and rising financial risks. In the months leading up to the outbreak of protests in December 2025, a large number of residents converted rials into USDT through over-the-counter (OTC) channels. In response, Iranian authorities began tightening regulatory policies, explicitly stipulating that individual holdings of stablecoins must not exceed the equivalent of $10,000, with an annual purchase limit not exceeding $5,000.
From a military and sanctions perspective, the cross-border settlement capabilities of stablecoins
In addition to civilian applications, stablecoins have also been used in Iran for cross-border fund transfers related to military and sanctioned entities. In 2025, Iran's defense-related export agencies publicly stated in their promotional materials that they support the use of cryptocurrencies as a payment method, which includes some military products and equipment exports.
According to data from TRM Labs, since 2023, Iran's Islamic Revolutionary Guard Corps (IRGC) has used Zedcex and Zedxion, two UK-registered cryptocurrency exchanges, to transfer a total of approximately $1 billion in funds. Most of these transactions have primarily used USDT on the Tron network. This reflects that, under sanction environments, stablecoins can also serve as alternative settlement channels.
Decentralized Technology Boundaries in Extreme Environments
Iran's nationwide internet shutdown significantly reduced the immediate usability of cryptocurrencies, but it also objectively spurred exploration into the feasibility of cryptocurrencies under extreme conditions. Civil society began experimenting with various solutions to cope with these extreme circumstances. Some technically capable users managed to maintain a tenuous connection to the blockchain network through satellite links such as Starlink. Although communication remained highly unstable, they retained limited capacity for cryptocurrency transactions.
Meanwhile, the code-based consensus of cryptographic assets demonstrates remarkable resilience when physical infrastructure is damaged. In contrast, the traditional banking system is absolutely dependent on physical infrastructure and administrative access. When a banking system is disrupted or goes offline due to turmoil, individuals, even if they have internet access, cannot access funds held in centralized institutions. Cryptographic assets, on the other hand, have virtually limitless boundaries. As long as there is an exit point on the network, assets can cross borders and bypass blockades to transfer value. Cryptographic assets thus expand the boundaries of financial services into a much broader space.
III. Observations and Reflections on the Game of Data Rights
From Territorial Sovereignty to Private Key Sovereignty
In the past, nations primarily controlled citizens' right to survival by controlling banks and legal tender. However, in the crises of Iran and Venezuela, it has become evident that geographic borders may be losing absolute control over wealth. As long as an individual holds the private key, their wealth is no longer subject to the collapse of domestic banks or the devaluation of fiat currency. This awakening of private key sovereignty represents the most fundamental value of cryptocurrencies in regions of extreme instability.
Resilience and Layering of Cryptographic Assets
Cryptocurrencies can help ordinary Iranian families preserve their savings amid inflation, while also enabling sanctioned entities to continue accessing resources through cryptocurrency networks. This dual nature highlights the resilience of cryptocurrencies, especially fully decentralized ones like Bitcoin (BTC), which reject any form of political screening. They serve neither the powerful nor belong solely to the weak; they are loyal only to algorithms. This cold neutrality is precisely the fundamental reason why they can achieve global consensus in a turbulent world.
However, when facing extreme political pressure and compliance reviews, different categories of crypto assets show clear stratification. Centralized stablecoins like USDT, while possessing the functional advantage of value pegging, have centralized control mechanisms embedded in their contract foundations. This means that the issuer can, based on external legal orders or compliance pressures, freeze assets at specific addresses at the smart contract level. This makes it evident that USDT still cannot escape the risk of external credit interference.
By contrast, native cryptographic assets represented by BTC and ETH have no single controlling entity and possess strong resistance to censorship, enabling autonomous settlement without requiring third-party permission. In survival scenarios where the traditional banking system fails or centralized protocols are restricted, these native assets governed solely by algorithmic logic may become the only value anchors with certainty in extreme situations, as well as the final credit fallback beyond the limits of technology.
At the same time, this urgent need to resist censorship has further driven the industry's exploration of privacy coins. By concealing transaction addresses and amounts, privacy coins aim to add information anonymity on top of the rigidity of algorithms, in response to increasingly stringent on-chain tracking and sanctions. This allows for the construction of a deeper technical defense layer under extreme conditions.
Cryptocurrencies are shifting from speculative attributes to survival attributes.
The cases of Iran and Venezuela also send a signal: under geopolitical conflicts, cryptocurrencies may become a refuge for ordinary people to survive. When fiat currencies lose credibility and internet access is cut off, the value of cryptocurrencies is no longer defined by their price increases, but rather by their ability to "support individual survival." This shift from speculative attributes to survival attributes will encourage more economies on the edge of credit collapse to fully embrace the cryptocurrency ecosystem at a fundamental level, viewing it as a digital sanctuary for modern civilization under extreme suppression.