Iran Completes Draft For State-Backed Cryptocurrency

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Iran, via its National Cyberspace Center (NCC), has revealed that the draft of the state-backed cryptocurrency project is ready.

Draft for the Iranian token is ready

The news announcing the completion of the draft for the crypto project was first announced by Financial Tribune on Friday, August 25.

This draft is part of the country’s plans which was first hinted earlier this year, to create a virtual currency to bypass the sanctions placed by the U.S. government.

According to the report published by Financial Tribune, the virtual currency project to be issued was developed on instructions from the President of Iran Hassan Rouhani, and the draft for the tokens has been completed.

The report further states that the idea to develop a state-backed cryptocurrency came with the government claims that a state-backed cryptocurrency will be used to function as a transfer of money internationally.

Saeed Mahdiyoun, one of the major regulators for drafts for the National Cyberspace Council, had commented to another local news outlet, that the concept of an Iranian digital currency has been a focus of the country’s cyberspace officials.

The Iranian state-issued tokens would also be used by the country to facilitate the transfer of money to and from anywhere in the world.

Mahdiyoun told local news agency IBENA that state authorities will soon remove the existing uncertainty around cryptocurrencies.

According to Mahdiyoun the Central Bank of Iran has embarked on a process to introduce its official stance on the issue at the end of September.

Iran and crypto-projects

The Iranian government has shown intolerance towards cryptocurrencies, and at the moment, cryptocurrency operations are banned by Iranian banks and credit institutions.

Earlier this year, the Iranian government supported the ban of Telegram’s initial coin offering (ICO) as well as a censorship on the use of the digital currency that was implemented in July of this year.

The ban on cryptocurrencies was enacted following the money laundering concerns that were first raised via a cryptocurrency in December 2017.

An Iranian politician, Mohammad Reza Pour-Ebrahimi had commented on the “serious hazards” that the foreign cryptocurrencies could yield. Mohammad Reza said:

“The future of world economy will be decided by digital currencies, but the use of foreign digital currencies can CAUSE serious hazards for the country in its banking system because of their lack of transparency and absence of an entity backing them.”

Before Iran placed an outright ban on the use of cryptocurrencies, the country had been receptive to the advent of digital currencies.

Iran turns to the cryptocurrency solution

The Central Bank of Iran banned commercial banks from facilitating cryptocurrency transactions as part of the measures taken by the government to stabilize the current currency crisis in the country.

The ban on cryptocurrencies has not worked out as planned, as Iran’s currency has continued to decline as economic sanctions begin to bite harder.

With the launch of a state-backed cryptocurrency in the works, the Iran authorities are looking at blockchain as a solution to circumvent challenges within the country.

A process similar to the practice carried out in Venezuela, the first country to issue a national cryptocurrency (Petro) in February this year.

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