In a report released by the Iranian Chamber of Commerce, the country's Central Bank finalized plans to launch its own cryptocurrency. The cryptocurrency, called "Crypto-Rial" (the rial is the country's official currency), is based entirely on blockchain technology and will be available in Iran on 22 September.
According to experts from the Central Bank of Iran (CBI), the cryptocurrency will help improve the country's financial situation. It will be used as a tool to help the economy compete with other cryptocurrencies globally.
Iran joins the circle of countries that regulate the cryptocurrency sector
Iran has a history of prejudice when it comes to cryptocurrency issues. Already in 2017, the Islamic nation had shown its position and willingness to embrace the new economic style by choosing to adopt cryptocurrencies.
However, an official initiative was only launched in October 2020. Indeed, during this period, the Iranian parliament changed previously published legislation to allow the use of cryptocurrencies for import financing.
In June 2021, the Iranian Ministry of Commerce issued 30 mining licenses to Iranian miners. With these, they have official permission to mine cryptocurrencies, provided they sell directly to the Central Bank of Iran.
This allows Iran to build a large reserve of cryptocurrencies which it now uses for import payments. Nonetheless, there has been a backlash especially on this front, as the cryptocurrency industry is consuming too much compared to what the country can handle.
In early 2022, the Iranian government passed a law that allows businesses to settle cross-border payments through cryptocurrencies. However, all of these transactions took place only through the Central Bank's cryptographic platform.
On August 10 of this year, Iran consolidated its position in cryptocurrencies by completing its first international import order fully paid for in cryptocurrencies worth $ 10 million.
The creation of a new national cryptocurrency
The Central Bank of Iran announced on Thursday the pilot launch of its cryptocurrency project. The announcement was made on the news portal of the Iranian Chamber of Commerce, Industry, Mines and Agriculture.
The main goal of this cryptocurrency project will be to convert traditional banknotes into programmable entities based on the blockchain. The use of this technology stems from the desire of Iranian leaders to create a stronger currency with a very high level of security.
Indeed, as a cryptocurrency, the Crypto-Rial was designed to be fully traceable. This traceability is possible even when the user's smartphone data is compromised.
However, the CBI says the cryptocurrency does not intend to compete with other cryptocurrencies, regardless of whether they are of national or international origin. In fact, unlike other ordinary cryptocurrencies, the Crypto-Rial will only be obtainable through the Central Bank. According to the governor of the CBI:
It is the Central Bank of Iran that has created the rules and infrastructure for this new cryptocurrency. It is a new type of national currency, but completely digital.
It is therefore entirely centralized, despite the use of the blockchain. In addition to being compliant with the country's anti-money laundering regulations, its users are hardly anonymous.
