The US still buys tonnes of shit from China, last I checked.

https://www.aljazeera.com/opinions/2026/4/28/how-the-us-israeli-war-is-collapsing-the-sanctions-regime-on-iran

'*Circumvention mechanisms already exist and the conflict is encouraging more entities to work with them....

For years, sociologists and political scientists have warned that sanctions do not work. They do not topple targeted governments; instead, they hurt their citizens. And yet, the use of sanctions has only expanded, with the US leading the charge. As a result, there is now increasing evidence that this over-reliance on such punitive measures has led to their growing ineffectiveness. The US-Israel war on Iran has made that all the more obvious.

The conflict carries the potential to push further the process of weakening the effect of US sanctions, which had already been ongoing, and reshape the preferences of both regional and global actors through different mechanisms, including de-dollarisation, alternative trading methods such as barter, and informal transfer networks like hawala.

The US relies on the dominance of its currency in global trade to leverage the sanctions it imposes. Sanctioned states are unable to carry out sanctioned trade because buyers and sellers process payments in dollars.

The spread of cryptocurrency as an alternative payment method across the world has provided a way to circumvent this problem. Over the past few years, Iran has come to heavily rely on cryptocurrency for financial transactions.

A report by blockchain data platform Chainanalysis shows that cryptocurrency flows to sanctioned entities went up remarkably in 2025, with their value rising 694 percent to a record $154bn – up from $59bn in 2024. In the final quarter of the year, the Islamic Revolutionary Guard Corps (IRGC) alone accounted for 50 percent of value received – a total of $3bn.

Iran converts cryptocurrency holdings into renminbi, which is then used to buy Russian goods or conduct trade across Asian markets – embedding itself further into an alternative financial architecture that strengthens the renminbi.

The war on Iran may now expand the pool of economic actors willing to use cryptocurrency to deal with the Iranian state and entities. When Tehran took control over the Strait of Hormuz, a chokepoint through which approximately 20 percent of the world’s oil and LNG passes, it began demanding transit tolls from vessels navigating the strait.

The fees, typically starting at $1 per barrel, were payable in Bitcoin or renminbi, and reports have shown that a number of vessels and companies paid. Unlike stablecoins such as USDT, Bitcoin is fully decentralised and cannot be frozen by any issuer.

With approximately 175 million barrels currently loaded onto tankers in the Gulf, even partial toll collection could make considerable revenue if the strait reopens.

The use of renminbi is also significant. China is the biggest buyer of Iranian oil, and it pays in its own currency. But other countries have also started using the renminbi. In 2024, 30 percent of China’s external merchandise trade was paid for in its currency.

The toll mechanism is particularly significant in encouraging more companies to use the renminbi precisely because it has made the costs of dollar dependence impossible to ignore. Countries that have long endured the inconvenience of dollar-denominated trade are now facing its geopolitical risk in real time – watching the US weaponise the dollar access against allies and adversaries alike through secondary sanctions, waivers granted and suspended at will, and a blockade that disrupts global energy markets regardless of a country’s relationship with the US.

However, de-dollarisation via cryptocurrency and renminbi represents only one layer of the alternative financial architecture that the war is accelerating. Beneath the on-chain economy lies a more informal but equally significant set of mechanisms – hawala networks and barter arrangements – that the war and blockade may push further into the mainstream of regional and global trade.

Hawala is an informal transfer system that has existed for centuries. It operates through a network of brokers who enable payments in different locations without the physical movement of money. In the case of Iran, hawala works through trusted intermediaries – often shell companies established in various countries – that facilitate transactions on behalf of Iranian entities without directly linking deals to Iran, allowing for continued import and export activity.

The system produces shared benefits – commercial activity, transaction fees, employment, and demand for legal and logistics services – that give host countries a direct economic stake in its continuation. Beyond material advantage, these arrangements strengthen bilateral ties that host governments regard as strategically valuable amid mounting energy security concerns. Hawala, therefore, does not only help Iran evade sanctions – it quietly recruits regional economies as stakeholders in that evasion, embedding circumvention into the normal functioning of regional commerce.

The war is likely to enhance the appeal of already existing barter arrangements and attract a wider range of regional and global actors. In 2021, for example, Iran and Sri Lanka signed an agreement for the latter to repay its debt in the form of tea exports. A barter agreement also exists between Iran and Pakistan. India is now considering oil for rice swaps, and there is the potential for expanding exchanges of industrial goods with Russia. Each of these bypasses conventional banking channels, removing exposure to secondary sanctions and dollar-denominated settlement.

Most notably, Iran may now extend this model to the Strait of Hormuz itself, turning transit toll revenues into commodities traded across regional, Asian, and European markets and transforming a wartime chokepoint into a node within a broader barter-based alternative economy.

Nevertheless, dollar dominance is unlikely to unravel overnight. About 80 percent of global oil transactions remain dollar-settled, and the currency still makes up about 57 percent of global foreign exchange reserves – against just 2 percent for the renminbi, whose tight capital controls limit its convertibility and hinder its viability as a true reserve currency.

What the US-Israeli war is accelerating is not immediate substitution but gradual erosion – a slow-motion shift whose endpoint remains uncertain but whose direction is increasingly difficult to reverse.

Taken together, de-dollarisation, hawala networks, and barter arrangements divulge a structural paradox at the heart of the US-Israeli war strategy towards Iran. The war has generated an outcome its architects did not anticipate: Rather than dismantling Iran’s resistance infrastructure, it has internationalised it, expanding what analysts describe as an “axis of evasion”. If this trajectory is maintained, the long-term casualty may not be the Iranian state but the sanctions regime itself – and with it, the dollar’s hegemonic role as the tool of Western geopolitical imperialism.