In 2025, the Iranian currency lost 50% of its value over the course of the year, cratering by 20% the last few weeks of December.
The year began with the dollar trading at approximately 817,500 rials. In December, Iranians needed 1.42 million rials per dollar. Since 40% of the Iranian economy was underground, where the dollar was the only currency that mattered, the economy came to a virtual standstill.
It's now at 1.6 million to the dollar, guaranteeing that the Iranian economy will continue to crash.
The crash of the rial led shopkeepers and other small business owners to pour into the streets, calling for the end of the regime. They were joined quickly by ordinary Iranians from all walks of life demanding change.
It was a spasm of state-sponsored violence never seen in Iran. UN rapporteurs cite medical records suggesting a toll far higher than official counts. The government claims about 3,100 dead protesters, including hundreds of security personnel. The UN claims 14,000-20,000 dead. Reports emerged in mid-January that the sheer number of casualties in Tehran and other major cities exhausted the supply of body bags, with authorities reportedly using semi-trailer trucks to transport the dead.
The protests have quieted, largely thanks to security personnel shooting or arresting anyone who dares protest. More than 40,000 people have been arrested. How many of those poor souls will emerge from captivity is unknown.
The internet in Iran is still down, and authorities are terrified of reinitializing it. Their vast internal intelligence networks are telling them that the people are not going back to blind obedience to the regime.That's because with the internet down, commerce in Iran has come to a screeching halt. Store shelves are empty. People aren't working. In a nation sitting on an ocean of oil, most gas stations are closed.
This has led Iran into a "doom loop." Commerce has slowed to a crawl, meaning the conditions that led to the economic protests in the first place have only worsened. It's inevitable that this will lead to more protests and another crackdown.
How much longer the regime can last is an open question.
Institute for the Study of War
Anecdotal reports from protester funerals and other commemorations in recent weeks indicate that Iranians continue to detest the regime and could protest if security pressure were lifted. The regime has killed thousands of protesters, and security forces have arrested 41,880 people—more than double the number arrested in the 2022 Mahsa Amini protests. Iranian judiciary officials have meanwhile threatened to show “no leniency” towards the arrested protesters. The internet shutdown demonstrates that the regime recognizes the fundamental reality that the unrest remains an existential threat due to the widespread nature of frustration at the economic situation and anger at the extreme violence the regime employed.
The internet shutdown is also liable to contribute to political grievances. The long-lasting internet shutdown has stripped the Iranian people of modern conveniences they have become accustomed to, including access to an online economy and the ability to communicate relatively easily. The continued imposition of the shutdown will likely continue to aggravate the Iranian people and can create the conditions that can lead to further uprisings.
Saudi Arabia and the United Arab Emirates (UAE) have informed Washington that they will not allow their airspace to be used for an attack on Iran. It hardly matters.
American military assets, including the deadliest weapons platform on Earth, the USS Abraham Lincoln aircraft carrier, along with several guided missile cruisers have officially entered CENTCOM's area of responsibility somewhere in the Arabian Sea.
On January 19, 2026, the Lincoln transited the Strait of Malacca westbound. By January 26, U.S. Central Command (CENTCOM) confirmed the strike group had officially entered the Middle East region.
I doubt whether all that firepower is for show. You don't send the Abraham Lincoln strike group from the Indo-Pacific region to the Middle East on a pleasure cruise. These ships are going to war sometime in the next few days.
Why now? It may be that U.S. advisors have judged the Iranian regime to be teetering on the edge of collapse and that one good push will bring the whole rotten edifice down.
It's a long shot, to be sure, but it's an opportunity that may not come again anytime soon. It may be a gamble worth taking.
