However, the CBI decided to take a more moderate stance towards digital technology and the block chain after the imposition of a new round of US sanctions, hoping that digital technology would facilitate international money transfers. Iran and allow the country to circumvent the sanctions.
Meanwhile, as an oil producer with oil-economy dominated by petrodollars, Iran has opted for the plan to use cryptocurrencies and block-chain technology to offset any oil spills due to sanctions. economic activities aimed at reducing oil sales.
Moving on the same path as China, Russia and Venezuela, Iran also hopes that the blockade of the chain of state-funded actions would lead to the end of the dollar and put an end to the policies of US tyrants.
Under the most severe US sanctions and Iran's blacklist from the international financial messaging system (SWIFT) based in Belgium, the country's plan to create an indigenous crypt currency is improving incrementally and thanks to nature highly dynamic cryptocurrency, can act as a good way for Iran to cover certain penalties through untraceable banking transactions.
The CBI has worked with national knowledge-based companies to develop a digital currency, called cryptography, supported by the Hyper Ledger Fabric technology.
As reported, Informatics Services Corporation, affiliated to CBI but managed by the private sector, has completed the development of the national crypted currency based on the rial and when the CBI approves the uses of national cryptocurrency, it will be issued by financial institutions such as banks to test payments and internal and inter-bank agreements.
In April 2018, the Iranian Central Bank banned banks and nationals from processing in foreign encrypted currency due to money laundering and financial risks
Transactions in virtual currency supported by the state are performed on an online ledger called a block chain, just like Bitcoin, but because the infrastructure is privately owned, it will not be possible for people to exploit it.
In fact, Iran is mainly aimed at testing the potentials of the cryptographic chain and cryptographic technology in managing its financial system, making banks able to use tokens as a payment tool in transactions and bank regulation in the first phase of the blockchain banking infrastructure. The country seems inclined to enjoy new virtual currency assets that include few alerts or fingerprints and has also prepared the necessary infrastructure for trading the encrypted currency in its stock exchange.
However, despite the CBI's ban on exchanging encrypted currencies, the Iranians had begun using cryptocurrency and Bitcoin mining for transactions with the rest of the world before it was banned by the CBI in the country.
Individuals and businesses in Iran have access to virtual currency platforms through "virtual currency exchanges based in Iran and the internet, virtual currency exchanges based in the US or other third countries, and peer-to-peer exchangers" peer (P2P) ", according to reports.
But the US embargo on a number of cryptocurrency platforms, including Binance and Bittrex, has restricted Iran to receive services, however, no assets belonging to the Iranians have been blocked. US sanctions have also trapped Iranian bitcoin traders.
In addition, in December, the US financial crime network, known as Fincen, issued a warning in an advisory to assist US banks and other financial actors such as cryptocurrencies in identifying "potentially illicit transactions related to the Islamic Republic of China". ;Iran". Bitcoin.com reported.
Fincen said that since 2013, Iran's use of virtual currency includes at least $ 3.8 million in transactions denominated bitcoins in the year. The organization noted that "while the use of virtual currency in Iran is relatively small, virtual currency is an emerging payment system that can provide potential avenues for individuals and entities to evade sanctions."
Fincen believes that P2P encrypted currency exchangers are a significant means by which Iran can avoid economic sanctions.
Following the announcement by the Fincen, US lawmakers introduced a law (HR 7321) to impose more sanctions on Iranian financial institutions and on the development and use of the national digital currency, the Coin telegraph reported .
The act prohibits transactions, loans or other reports related to an Iranian digital currency and introduces sanctions against foreign individuals engaged in the sale, supply, holding or transfer of the digital currency.
In the wake of US restrictions, therefore, the trading of encrypted currencies is limited to the national market of Iran and is not possible internationally and Bitcoin is sold at a significant premium compared to the global average price in Iran.
Unfortunately, the basic and prominent regulations on the use of cryptocurrencies have not been ratified in Iran and the Iranians are obliged to refer to foreign exchange shops to do their own encryption, most of which are obedient. to US regulations and, of course, sanctions.
In order to make the cryptocurrency and the chain of blocking technology both legal and official in the country, the Iranian government is developing a political framework with the help of the CBI and the Stock Exchange Organization which clarifies all of its rules and policies on cryptocurrency and mining.
Being legislated, it is believed that SWIFT can be replaced by digital money, that is, the national currency rial-pegged, and transactions would be made faster and at lower prices.
Due to the lack of required regulations, loads of mining cryptocurrency equipment are seized by the customs administration. It is said to be released as soon as the government will legalize the use of encrypted currency in the country.
Published in the Daily Times, 20 Januaryth 2019.