Details are beginning to emerge from Iran as to how the heavily US-sanctioned nation is making effort to bypass its very economic and financial restrictions – by leveraging the use of cryptocurrency.
Speaking to local Iranian media, Mohammad-Reza Modoudi, acting head of Iran’s Trade Promotion Organization (TPO), said, “Representatives from Switzerland, South Africa, France, England, Russia, Austria, Germany and Bosnia have visited Iran to hold related talks about the issue.”
While The Crypto Sight recently reported (Jan 29) that Iran could soon be launching its own state-backed crypto, more information has surfaced on the Iranian government’s move towards opening up the use of crypto. The Central Bank of Iran (CBI) has published a draft regulatory framework called “Version 0.0”, which Al Jazeera reported as reversing Iran’s previous prohibition on crypto assets, though using global crypto inside the country as a form of payment is still prohibited.
The draft framework is meant to organize and define “ongoing crypto operations” in Iran, said Al Jazeera, noting that CBI recognized and approved the use of crypto like Bitcoin, Iran’s own upcoming official version, and as yet unnamed regional crypto. Initial coin offerings (ICOs), crypto wallets and exchanges, tokens, and mining operations are also reportedly endorsed.
To protect the Iranian Rial from losing further value, however, the country has blocked its citizens from possessing large amounts of crypto assets just as they are not allowed to hold more than EUR10,000 in fiat. All financial institutions in Iran are currently banned from handling cryptocurrencies so as to prevent currency outflows from the country. It is believed this ban will be overturned when Iran’s new crypto framework kicks in.
Iran also signed a trilateral blockchain agreement with Russia and Armenia in November 2018.
Iran is rather isolated from participating in world trade, with American sanctions depressing its various sectors such as oil, shipping, and finance. Swift no longer serves Iran, and major crypto exchanges such as Binance and Bittrex have avoided it as well.