Iran Prepares to Introduce National Cryptocurrency
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According to numerous sources, the Iranian government is developing a state cryptocurrency.

In April, Mohammad-Javad Azari Jahromi, Information and Communications Technology Minister, said that a state-issued cryptocurrency is ready for trial. If the project is developed, Iran will become the second country in the world to circumvent American sanctions by way of a cryptocurrency.

Why it is important

  1. Iran has been cut off from the global economy for a long time - payment systems such as Visa and Mastercard, for instance, are unavailable there. The economy has been under tremendous strain, with particular stress falling on the export-oriented oil and gas sectors.
  2. The currency was developed due to fears stemming from the risks new sanctions pose to Iran’s economy. On May 8, US President Donald Trump announced that the United States is imposing new sanctions against Iran. The government believes that it is possible to bypass sanctions through the cryptocurrency. The US will not be able to block its spread.

The Rial, Iran’s national currency, significantly fell against the dollar. Domestic economy entered a crisis that could only worsen because of sanctions. The Iranian Central Bank is trying to remedy the situation by uniting the official and black market exchange rates. However, the fall of rial is continuing.

To solve the current crisis, the Iranian authorities have had to change their attitude to cryptocurrencies. The Iranian Parliament’s Economic Commission considers cryptocurrency transactions as speculation, with foreign cryptocurrencies posing an alleged threat to Iran's banking system. Two weeks ago, Iran’s central bank prohibited banks in the country from dealing in cryptocurrencies, which significantly reduced bitcoin transaction volume. At the same time, inrecent months, Iranians have spent $2.5 billion purchasing cryptocurrency.

By Ekaterina Ulyanova

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