Iran Pushes Bitcoin-Based Marine Insurance for Strait of Hormuz Shipping

Iran is moving to introduce a Bitcoin-based marine insurance service for vessels transiting the Strait of Hormuz, in what appears to be an effort to open a new source of foreign-currency revenue amid tensions with the U.S. and Israel.

Bloomberg reported on May 18 that Iran's semi-official Fars News Agency, citing documents from the Ministry of Economic Affairs and Finance, said the government had launched the service under the name Hormuz Safe.

The program offers cryptographically verifiable insurance certificates for ships and cargo passing through the Strait of Hormuz and the Persian Gulf. Premiums are to be paid in Bitcoin.

The Iranian government says the service could generate more than $10 billion in revenue over the long term. It has not disclosed details on how the program would operate or how the revenue would be generated.

Iran is also moving to tighten its control over the Strait of Hormuz following U.S. and Israeli airstrikes. The Islamic Revolutionary Guard Corps, or IRGC, and the government are also reviewing plans to impose transit charges and other fees.

Bloomberg said Iran has expanded its use of digital assets such as Bitcoin and Tether's USDT to bypass U.S. sanctions. As a sanctioned state, Iran has increasingly relied on crypto-based payment infrastructure instead of traditional financial networks.

Still, questions remain over whether Bitcoin's price volatility would allow it to function as a stable payment tool for international marine insurance. Foreign shipping companies may also be reluctant to participate because of concerns about violating U.S. sanctions on Iran.