Iran still pushing to create local cryptocurrency

With the nationwide ban by the Central Bank of Iran, Iran is still moving ahead with plans to develop a local cryptocurrency coin, according to a government minister.

David Nurieli
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Iran’s central bank has prohibited local banks from dealing in cryptocurrencies, citing fears of associated money laundering and the country's risk of being sanctioned. In related financial news, Iran has made moves this month to formally unify its open market exchange rates. This also includes banned money changing outside of banks.

Despite all this, Mohammad Javad Azari-Jahromi, Iran’s Information and Communications Technology Minister, has said the government’s local cryptocurrency project will not be affected by the banks regulations:

The central bank’s [ban] does not mean the prohibition or restriction of the use of the digital currency in domestic development,” state news agency IRNA quoted him as saying. “Last week, at a joint meeting to review the progress of the [local cryptocurrency] project, it was announced that the experimental model was ready,” Azari-Jahromi added.

The Minister has confirmed that the new currency would be backed by Iranian assets. This will ensure that it has the real value many Islamic leaders insist is necessary for complying with Sharia’s requirements.

Central Bank doesn’t recognise cryptocurrencies and has warned Iranian citizens about the high risks of making investments. Especially in the potentially volatile cryptocurrency market, saying that there’s a chance citizens may lose their financial assets. Moving forward, the bank will continue working with institutions to develop mechanisms to control and prevent the use of digital currencies in the country. The bank described the digital coins as follows: The wild fluctuations of the digital currencies along with competitive business activities underway via network marketing and pyramid scheme have made the market of these currencies highly unreliable and risky.