My reply to : Iran Economy Crashes as Protesters Demand Mullahs to Step Down

[Rick1234567S]

As of 2026, the devalued Rial indeed offers strategic economic advantages and "workarounds" that allow 

 to bypass the US Dollar. From a non-US centric perspective, the weak currency acts as a powerful catalyst for specific domestic sectors.

1. "Arbitrage Tourism" and Local Sales

The Rial's low value creates a massive price advantage for anyone with foreign currency (including BRICS partners like Russia or China) at venues like the 

.

• Export-Grade Quality at Domestic Prices: At current exchange rates, labor-intensive luxury goods like hand-knotted carpets or artisanal apparel are "on sale" for foreigners. A 12x12 carpet that might retail for $40,000 in London can be acquired for a fraction of that in Tehran due to the low local labor costs in USD terms.
• Shopping Events: Iran is actively leveraging this via events like Iran Mode 2026 (Apparel Show), positioning its clothing and fashion industry as a high-quality, low-cost alternative for international buyers.

2. Import Substitution and Industrial Growth

A weak currency makes foreign imports prohibitively expensive for locals, which has forced a "self-sufficiency" boom in Iran's domestic industry.

• Domestic Production: Iran has targeted producing $10 billion worth of previously imported goods domestically using indigenous technology.
• Competitive Exports: Iranian-made petrochemicals, steel, and agricultural products are now highly price-competitive in regional markets (Iraq, Turkey, and Central Asia), leading to projected trade surpluses of roughly $35 billion.

3. Payment System Workarounds (Bypassing USD)

Iran has successfully built a parallel financial infrastructure to avoid USD-denominated trade:

• Shetab-Mir Integration: Since 2025, the full integration of Iran’s Shetab and Russia’s Mir systems allows for direct Rial-to-Ruble transactions, meaning tourists and businesses no longer need to touch a single US dollar for travel or trade between these nations.
• BRICS Pay: As of early 2026, Iran is a leading participant in BRICS Pay, which uses blockchain and tokens to settle trades in national currencies.
• Oil-for-Infrastructure Barter: With China, Iran frequently uses "shadow" banking where oil is traded directly for Chinese-built infrastructure (rail, data centers), removing the need for a medium of exchange like the USD.
• Cryptocurrency for Trade: Iran officially utilizes cryptocurrencies to pay for international imports from BRICS partners, providing a digital rail that US sanctions cannot easily block.

4. Government Fiscal Benefits

The Iranian government itself generates significant revenue from currency devaluation. By selling its foreign currency reserves (earned from oil) at the higher open-market Rial rate, it can more easily cover domestic obligations like civil servant salaries and infrastructure projects in the 2026 budget.

[Rick1234567S]

Scenario 1: Pre-Devaluation Rate
Rate: $1 USD = 10,000 IRR
Rug Price: 100,000,000 IRR
Cost in USD: $10,000 USD
Scenario 2: Current Devalued Rate
Rate: $1 USD = 42,000 IRR
Rug Price (in Rials, adjusted for local inflation): 150,000,000 IRR
Cost in USD: ~$3,571 USD

Bilateral Connections: Iran's Shetab system has been successfully connected with Russia's Mir payment network. This allows Iranian cardholders to withdraw rubles at ATMs in Russia and Russian cardholders to pay in Iran using their cards, facilitating trade and tourism between the two countries.

Alternative Channels: Iran utilizes the ACU-MIR system (operational since late 2023) to conduct international business with India and Pakistan, effectively bypassing the Western-led SWIFT network for trade.
Live Integration: Holders of Iranian Shetab cards can withdraw rubles from ATMs in Russia, and Russian Mir cardholders can use Iranian POS systems as of 2025.
BRICS Standard: Iran is actively using this Russia-Iran success as the blueprint for its 2026 strategy to integrate with the broader BRICS Pay system, aiming to enable mutual payments in national currencies across all member nations

n summary, while China only has one official currency (the Renminbi), the offshore CNH version is what is used internationally and is already a primary component in trade settlement with Iran, often bypassing the USD.