Bitcoin BTC USD shipping insurance Iran explained: Why is Iran using Bitcoin (BTC) for the ‘Hormuz Safe’ shipping insurance system in the Strait of Hormuz amid US-Iran tensions?
Iran Turns to Bitcoin (BTC USD) for Strait of Hormuz Shipping Insurance: What is “Security of Hormuz”?
As reported by Business Insider, the report, based on documents attributed to the country’s Ministry of Economy and Financial Affairs, states that Iran has launched a bitcoin-backed shipping insurance service for Iranian ships. Dubbed “Hormuz Secure,” the system will provide payments in bitcoin, defined as cryptographically verifiable insurance policies, for shipments passing through the Persian Gulf, the Strait of Hormuz, and nearby waters.
Can Iran’s Bitcoin Shipping Model Earn $10 Billion?
According to Business Insider, while the details of how the service will work remain unclear, Fars suggested that the initiative could generate as much as $10 billion in revenue.
Babak Zanjani Linked to Controversial Bitcoin Insurance Offer
The idea is also linked to Iranian businessman Babak Zanjani, who is accused of embezzling funds from Iran’s oil ministry. According to Bloomberg, Zanjani started promoting the concept on social media on May 8.
US-Iran tensions continue due to restrictions on shipping in the Strait of Hormuz
This development comes amid ongoing tensions between the United States and Iran, as US President Donald Trump’s efforts to reach an agreement to end the conflict have reportedly failed to produce lasting results. Meanwhile, shipping through the Strait of Hormuz remains severely restricted.
How Are Conflicts Disrupting Trade in Oil, Fertilizer, Helium and Petrochemicals?
The disruption affected the flow of oil as well as other commodities, including fertilizer, helium and petrochemicals.
Bitcoin (BTC) Adoption in Iran Reportedly Increased During Ongoing Conflict
According to the report, data from digital asset manager CoinShares shows that Bitcoin usage in Iran increased significantly during the conflict. “Nearly 14 million Iranians, or about one in six, use Bitcoin; annual transaction volumes are up 11.8% year-over-year and now represent ~2.2% of Iran’s GDP,” analyst Chris Bendiksen said, as quoted by Business Insider.
Why Are Experts Questioning the Feasibility of Bitcoin Shipping Insurance?
Despite these figures, questions remain about the practicality of using bitcoin in a shipping insurance system tied to one of the world’s most restricted maritime crossing points. Traffic on the waterway is near a standstill, and both the United States and Iran have stated that they are continuing efforts to block the passage of ships trying to pass through the Bosphorus.
Sanctions Risks Raise Doubts About Global Shipping Adoption
There are also concerns that sanctions risks could make the system difficult to use, particularly for global shipping companies operating on international routes where exposure to Iran-linked systems could have regulatory implications.
FAQ
What is Iran’s bitcoin shipping insurance plan?
It is a system called “Hormuz Secure” that uses Bitcoin for marine insurance.
What is the latest situation in the Strait of Hormuz?
Shipping is severely restricted and near a standstill.
