Iran to Issue State Cryptocurrency Following Bitcoin Ban
Iran’s information and communications technology minister Mohammad Javad Azari-Jahromi says Iran is releasing a state-issued cryptocurrency that’s now ready for trial. The currency was developed due to fears stemming from the risks U.S. President Trump’s new sanctions pose to Iran’s economy.
Not All Crypto Is Created Equally
The decision to release the currency comes days after the state decided to officially ban the trading of all virtual assets – including bitcoin.
“Last week, at a joint meeting to review the progress of the local cryptocurrency project, it was announced that the experimental model was ready. The Central Bank’s ban does not mean the prohibition or restriction on the use of the digital currency in domestic development. The CBI ban on bitcoin dealings was made due to concerns that the volatility in the crypto market could lead people to lose their assets. Bitcoin is not the one and only cryptocurrency.”
Bitcoin Ban Paves the Way
The nation banned bitcoin and cryptocurrency trading earlier this month due to fears of money-laundering. However, May 12th marks Trump’s official “decision day” regarding if (or when) the U.S. will pull out of the nuclear deal it currently has with Iran, and he is pressuring several European nations to work with the United States to fix the deal.
Iran’s state currency – the rial – has since plunged dramatically, and the new coin is slated to ease some of the negative effects on the country’s financial infrastructure.
This Has Been a Long Time Coming
Iran’s work with digital currencies dates as far back as October 2017, when then-deputy minister of information and communication technology Amir Hossein Davaee stated that representatives were already conducting “several research studies” as part of group efforts to prepare Iran “to use bitcoin inside the country”.
Unfortunately, bitcoin use within the nation’s borders was not meant to be, as fears of financial crime overwhelmed the government’s initial considerations of bitcoin’s potential. The Central Bank of Iran’s Naser Hakimi also referred to crypto’s ongoing volatility, and the fact that it was seemingly vulnerable to hacks and thefts.
Iran Working Towards the Future
Those concerns continued into February of this year, when the country initially hinted it was examining cryptocurrency technology and was looking at potentially releasing a national digital coin. The country is still largely cut off from major financial institutions like Visa and PayPal, and believe a state-issued digital asset could assist in boosting Iran’s economy.
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Images via Pixabay
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