Iran at 'zero visibility' as demands for secular democracy swell

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Iran at 'zero visibility' as demands for secular democracy swell

Published: 03 Feb. 2026, 00:03

Audio report: written by reporters, read by AI

Park Hyon-do

The author is a professor at Sogang University’s EuroMENA Research Institute.

Last October, Ayandeh Bank, the Iranian lender that built the world’s largest shopping complex, the Iran Mall, collapsed. The mall covers an area equivalent to 270 soccer fields. Ayandeh had expanded its deposit base by offering interest rates as much as four percentage points above the ceiling set by financial authorities. Its business model closely resembled a Ponzi scheme, using a steady inflow of new deposits to pay interest to earlier investors. Since adopting the Ayandeh name in 2013, the bank grew rapidly, accounting for 7.6 percent of total bank deposits nationwide by 2017. The deeper problem lay in its asset allocation. Roughly 70 percent of its loans were extended to a wholly owned subsidiary developing the Iran Mall, concentrating risk heavily in real estate.

A man carries a carpet at Tehran's historic Grand Bazaar on Jan. 20, 2026, in Iran. [AP/YONHAP]

Ayandeh built the mall in the hope that the nuclear agreement would attract foreign investment and generate profits. The complex opened in 2018. That hope collapsed when U.S. President Donald Trump withdrew the United States from the Iran nuclear deal on May 8 that year and reinstated economic sanctions. Ayandeh soon sank into insolvency. By last October, the bank shut its doors with liabilities totaling 550 quadrillion rials, or about $5.1 billion.

Warnings that the government would be forced to print money through state banks if Ayandeh failed to liquidate its real estate assets soon materialized. Inflation surged, adding strain to an already battered economy. Iran’s central bank had long been aware of corruption at Ayandeh but was unable to act decisively, amid persistent rumors that powerful elites stood behind the bank.

A woman mourns next to the flag-draped coffins of a group of security forces, who were killed during anti-government protests, during their funeral ceremony, in Tehran, Iran, on Jan. 14, 2026. [AP/YONHAP]

By October and November last year, consumer inflation reached nearly 50 percent. The rial hit record lows against the dollar. When the nuclear deal was concluded on July 20, 2015, one dollar bought 32,370 rials. By Dec. 28 last year, it took 1,432,000 rials, a 44-fold depreciation. In Korean terms, it was akin to paying 61,880 won for a dollar that once cost 1,400 won.

Merchants importing electronics were the first to erupt in anger. Traders in Tehran’s Aladdin and Chaharsouq electronics markets, often likened to Seoul’s Yongsan electronics district, shut their shops on Dec. 28 and staged protests, saying even the cheapest smartphones were now unsellable. Merchants in Tehran’s Grand Bazaar soon joined. Alarmed, the government adopted a conciliatory tone, acknowledged policy failures, replaced the central bank governor and promised dialogue. It pledged to unify exchange rates at the market level and to pay all citizens 10 million rials per month for four months.

Iran introduced a multi-tier exchange rate system in 2018 to cushion sanctions. Essential imports were priced at 42,000 rials per dollar, secondary goods at 80,000 to 90,000 rials, with the rest left to the market. Over time, the secondary rate was abolished. At the time of the protests, the essential goods rate stood at 285,000 rials. Even this became unsustainable after European countries restored sanctions in September, further weakening the rial.

Since the 1979 revolution, Iran has seen many protests, but never one led by merchants. Traders typically avoid confrontation, preferring stability that allows commerce. Their mobilization shocked authorities, especially because merchants had been pillars of the 1979 revolution. The government offered currency and subsidy fixes but avoided pledges to punish corrupt elites. The promised subsidy rang hollow. In October, a 30-egg carton cost 1.98 million rials, already up from 1.3 million. Last month, it rose to 5 million.

Dates, known as “the food of the Prophet and the imams,” cost 3.76 million rials for 700 grams last October. With a monthly minimum wage of 104 million rials, a worker could buy 27 boxes. The subsidy barely covers three.

As economic protests simmered, political anger resurfaced. Though initially smaller than the 2022 hijab protests, demonstrations expanded with overseas opposition support and encouragement from Donald Trump, pushing the government toward a crisis it struggled to contain.

Iran’s first post-revolution protest erupted in July 1999, when Tehran University students protested the closure of the reformist newspaper Salam. Police and militias crushed the protests violently. Chants of “Down with Khamenei” emerged for the first time.

In this photo released by an official website of the office of the Iranian supreme leader, Supreme Leader Ayatollah Ali Khamenei speaks in a meeting, in Tehran, Iran, on Jan. 17, 2026. [AP/YONHAP]

Subsequent waves followed in 2009 over election fraud, in 2017 and 2019 over fuel subsidies and economic hardship. Protesters declared, “Reformists or hard-liners, the game is over,” rejecting the Islamic Republic itself. They even invoked Reza Shah, founder of the Pahlavi dynasty, chanting “Reza Shah, rest in peace,” a striking rebuke to clerical rule.

In 2022, protests sparked by the death of Mahsa Amini adopted the slogan “Woman, life, freedom.” Last year, demonstrators chanted “Long live the Shah,” not as a monarchist call but as an expression of yearning for secular democracy over Islamic rule.

The government’s crackdown extinguished the protests, leaving disputes over casualties and foreign interference. Trump maintains pressure on Iran, less to topple the regime than to curb its nuclear ambitions. As of Tuesday, Iran faces a situation with virtually no visibility ahead.

This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.