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The “Hamster” cryptocurrency craze has taken over Iran. It highlights the economic malaise ahead of the presidential elections

Published

7 months ago

24 June, 2024

The “Hamster” cryptocurrency craze has taken over Iran. It highlights the economic malaise ahead of the presidential elections

DUBAI, United Arab Emirates (AP) — Taxi drivers and motorcyclists tap furiously on their cell phones as they wait at red lights in the Iranian capital during an early June heat wave. Some pedestrians in Tehran are doing the same. Everyone believes they could get rich.

The object of their rapt attention? The “Hamster Kombat” app.

Aside from the broader cryptocurrency craze, the app’s rise in Iran highlights a harder truth the Islamic Republic faces ahead of Friday’s presidential election that will replace a belated one. President Ebrahim Raisi, died in a helicopter crash in May: an economy hampered by Western sanctions, persistently high inflation and a lack of jobs.

Also as presidential candidates make promises about restore the country’s economyIranians, who were heard about bitcoin for yearsthey are now piling into this app in the pure hope that one day it will bear fruit, without knowing much about who is behind it.

“It’s a sign of desperation, honestly,” said Amir Rashidi, director of digital rights and security at Miaan Group and an expert on Iran. It’s about “trying to hold on to anything you have a little hope that might one day turn into something precious.”

Those able to divest from holdings in Iran’s beleaguered currency, the rial, have been buying propertyart, vehiclesprecious metals and other tangible assets following the collapse of Tehran’s 2015 nuclear deal with world powers.

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At the time of the agreement, the exchange rate was 32,000 rials for 1 dollar. Today it approaches 580,000 rials to the dollar – and many have found that the value of their bank accounts, pension funds and other holdings has been weakened by years of rapid depreciation.

Meanwhile, prices of fruit and vegetables have increased by 50% compared to last year, while the price of meat has increased by 70%. The cost of a shared taxi ride, common in the Iranian capital, has almost doubled. Rides on Tehran’s subway, still the cheapest option for the city’s commuters, also increased by about 30%.

“Since morning I have had three visitors in my shop, none of them bought anything,” said Mohammad Reza Tabrizi, who runs a clothing store in central Tehran. “Most customers prefer to buy from street vendors or used items in other places.”

In underground passages and other areas of the city, street vendors sell almost anything they can get their hands on. It is this desperate environment that has seen increased public interest in cryptocurrencies and mobile games that offer coins.

The proliferation of smartphones across Iran, as well as the relatively low cost of mobile service compared to other nations, make access to apps like “Hamster Kombat” attractive.

The app is accessed via the Telegram messaging app, which remains popular in Iran despite authorities’ efforts to block access. It works like an incremental or “clicker” game: users repeatedly click on an object or complete repetitive tasks to earn points.

In “Hamster Kombat,” users believe they can access a supposed cryptocurrency associated with the game that has not yet been publicly traded.

In an email, people describing themselves as the game’s developers declined to answer questions about their identities or business plans, but insisted that they were “not offering any cryptocurrency in the game.”

“We are educating our audience about cryptocurrencies through game mechanics,” the email states.

However, the game resembles another app that once offered cryptocurrency to Iranians – and it seems that just the promise of what could be free money could drive some Iranians to distraction.

Online jokes show a man touching a tombstone as if it were a cell phone. Another uses a massage gun to quickly poke an on-screen hamster.

But the public’s interest in the game has also attracted the attention of the authorities.

Rear Admiral Habibollah Sayyari, deputy head of Iran’s military, described the app as part of the West’s “soft war” against Iran’s theocracy ahead of the election.

“One of the characteristics of the enemy’s soft war is the game of ‘Hamster,’” Sayyari said, according to state news agency IRNA. He theorized that the “enemy” is popularizing the game so that people will be distracted and not “pay attention to the plans of the presidential candidates.”

“Then (people) fail to choose the best candidates,” Sayyari said. Hardline experts in Iran have expressed similar views.

The JameJam newspaper, published by Iranian state television, also warns that the ever-increasing interest in the game is a sign of “the dream of becoming rich overnight and accumulating wealth effortlessly.” Players are said to range from “builders, mechanics and refrigerator repairers to colleagues and classmates at university.”

“A society that instead of working and trying to succeed and earn money relies on these games and looks for shortcuts and windfalls, gradually loses the culture of effort and entrepreneurship and shifts towards convenience,” the newspaper said, without recognizing that the country’s economic problems were potentially driving interest in the app.

The app has even caught the attention of a 97-year-old Shiite religious scholar, Ayatollah Nasser Makarem Shirazi, known for his fatwas declaring things “haram” or “forbidden” from his office in the holy city of Qomthe Iranian center of Shia learning, full of religious schools and venerated shrines.

Calling the cryptocurrency “the source of a lot of abuse,” Shirazi said people should not use the “Hamster Kombat” app or similar ones involving bitcoin.

Iran is not alone in having concerns about the game.

Authority within Ukraine, engaged in a devastating war with Iran-armed Russia since Moscow’s 2022 invasion, warned that user data remains stored in Russia and could potentially put it at risk.

Then there is the broader risk of exposure to malware as consumers in Iran often cannot legally purchase new software or even access legitimate app stores. They also address the risk of state-sponsored hackers targeting them for their political opinions.

Meanwhile, as Iran’s election campaign continues, presidential candidates are using Instagram, X and Telegram, all services previously banned by the theocracy after a series of nationwide protests.

“As long as you are able to pay the price, everything is available,” said Rashidi, the Iran expert.

___

Karimi reported from Tehran, Iran.

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AltcoinUpdates Staff

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CNBC Crypto World features the latest news and daily trading updates from the digital currency markets and gives viewers a glimpse of what’s to come with high-profile interviews, explainers and unique stories from the ever-changing cryptocurrency industry. On today’s show, Ledn Chief Investment Officer John Glover weighs in on what’s driving cryptocurrency prices right now and how the potential approval of spot ether ETFs could impact markets.

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Miners’ ‘Capitulation’ Signals Bitcoin Price May Have Bottomed Out: CryptoQuant

Published

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3 July, 2024

AltcoinUpdates Staff

Miners' 'Capitulation' Signals Bitcoin Price May Have Bottomed Out: CryptoQuant

According to CryptoQuant, blockchain data shows signs that the Bitcoin mining industry is “capitulating,” a likely precursor to Bitcoin hitting a local price bottom before reaching new highs.

CryptoQuant analyzed metrics for miners, who are responsible for securing the Bitcoin network in exchange for newly minted BTC. As outlined in the market intelligence platform’s Wednesday report, multiple signs of capitulation have emerged over the past month, during which Bitcoin’s price has fallen 13% from $68,791 to $59,603.

One such sign includes a significant drop in Bitcoin’s hash rate, the total computing power that backs Bitcoin. After hitting a record high of 623 exashashes per second (EH/s) on April 27, the hash rate has fallen 7.7% to 576 EH/s, its lowest level in four months.

“Historically, extreme hash rate drawdowns have been associated with price bottoms,” CryptoQuant wrote. In particular, the 7.7% drawdown is reminiscent of an equivalent hash rate drawdown in December 2022, when Bitcoin’s price bottomed at $16,000 before rallying over 300% over the next 15 months.

This latest hash rate drop follows Bitcoin’s fourth cyclical “halving” event in April, which cut the number of coins paid out to miners in half. According to CryptoQuant’s Miner Profit/Loss Sustainability Indicator, this has left miners “mostly extremely underpaid” since April 20, forcing many to shut down mining machines that have now become unprofitable.

CrypotoQuant said that miners faced a 63% drop in daily revenue after the halving, when both Bitcoin block rewards and transaction fee revenues were much higher.

During this time, Bitcoin miners were seen moving coins from their on-chain wallets at a faster rate than usual, indicating that they may be selling their BTC reserves“Daily miner outflows reached their highest volume since May 21,” the company wrote.

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US Congressman French Hill Doubles Down on Trump’s Pro-Crypto Stance

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3 July, 2024

AltcoinUpdates Staff

US Congressman French Hill Doubles Down on Trump's Pro-Crypto Stance

US lawmaker French Hill has noted that Donald Trump will take a more pro-crypto approach than the current administration. The run-up to the presidential election has seen cryptocurrencies become an issue with lawmakers making huge statements ahead of the polls. Donald Trump has also been reaching out to the industry, making a pro-crypto case.

French Hill Backs Trump’s Pro-Crypto Stance

Republican Congressman French Hill has explained the type of cryptocurrency regulatory framework he believes Donald Trump could adopt in the country. In a recent interview with CNBC, French Hill said that the recently passed FIT21 bill is the type of regulatory framework the Trump administration will adopt in the sector.

#FIT21 passed the House with 71 Democratic votes, it’s exactly the kind of digital asset regulatory framework former President Trump would support if re-elected.

See more on @SquawkCNBC🔽 photo.twitter.com/ceTmU4LApU

— French Hill (@RepFrenchHill) July 3, 2024

THE FIT21 Bill It is intended to protect investors and consumers in the market by establishing clear rules and powers for the various regulators in the sector. According to Hill, Trump will adopt it because it directs the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) on the specific regulatory framework needed in the market.

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This election cycle saw the cryptocurrency industry taking a place in mainstream issues following broader adoption across demographics. From candidates moving toward enthusiasts to recent pro-Congress legislation, cryptocurrencies have become a rallying point for officials. The U.S. regulatory landscape has been criticized for stifling growth due to frequent SEC LawsuitsThis has led executives to push for pro-cryptocurrency laws and raise money for pro-industry candidates.

David Pokima

David is a financial news contributor with 4 years of experience in Blockchain and cryptocurrency. He is interested in learning about emerging technologies and has an eye for breaking news. Keeping up to date with trends, David has written in several niches including regulation, partnerships, cryptocurrency, stocks, NFTs, etc. Away from the financial markets, David enjoys cycling and horseback riding.

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US Court Orders Sam Ikkurty to Pay $84 Million for Cryptocurrency Ponzi Scheme

Published

7 months ago

3 July, 2024

AltcoinUpdates Staff

U.S. Court orders Sam Ikkurty to pay $84M for crypto Ponzi scheme

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Judge Rowland found that Ikkurty, based in Portland, Oregon, did numerous false claims on his company’s hedge funds.

These included misleading statements about his trading experience and the promise of high and stable profits. Instead, Ikkurty used funds from new investors to pay off previous investors, a hallmark of a Ponzi scheme.

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The court found that Ikkurty misappropriated investment funds for personal use without the knowledge of the investors. These funds were used for personal use and were reported as Fraudulent Investmentscausing significant financial losses to customers.

This non-transparent operation violated Transparency Commission regulations, which led to the imposition of a hefty fine to compensate defrauded investors and restore some public confidence in the financial system.

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