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US lawmakers have introduced a bill to impose further sanctions on Iranian financial institutions and on the development and use of the national digital currency. HR 7321 was presented to the House of Representatives by the representative Mike Gallagher on December 17th.
In an effort to combat money laundering and terrorism-related activities, the "Law on Illicit Financing of Iran" requires sanctions on the Iranian financial sector and on the development and use of national cryptocurrency.
The act specifically prohibits transactions, loans or other reports related to an Iranian digital currency and would also introduce sanctions to foreign individuals engaged in the sale, supply, holding or transfer of the digital currency.
The act also requires a report to Congress on the Government of Iran's progress in developing a sovereign digital currency. A corresponding invoice was introduced in the Senate by the former president of the Republic Ted Cruz on December 13th.
The US government introduced sanctions against Iran for its nuclear program in 2005, while the US Senate and House of Representatives passed the full law on sanctions, accountability and disinvestment in Iran in 2010. sanctions have hit the financial sector of the country, except for Iran's financial institutions from directly accessing the US financial system.
The sanctions were lifted in 2015 after the country agreed to compose its nuclear program to meet the standards set by the International Atomic Energy Agency in the Joint Global Action Plan (JCPOA).
However, in May 2018, US President Donald Trump announced that America would withdraw from the JCPOA that had been negotiated under its predecessor, President Barack Obama. The penalties were subsequently reintroduced.
Many Iranians have turned to cryptocurrency as a way to circumvent sanctions. In May, Mohammad Reza Pourebrahimi, head of the Iranian Parliamentary Committee on Economic Affairs, cited cryptocurrencies as a promising way for Iran to avoid transactions in US dollars, and to eventually replace the SWIFT interbank payment system .
As Cointelegraph reported earlier in December, the Iranians are turning to the Bitcoin (BTC) extraction due to economic difficulties. Despite the recent collapse of the encrypted markets and the fluctuations of the national currency caused by sanctions, the Iranian people are still getting profits from Bitcoin mining.
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