Iran’s Government Officially Recognizes And Accepts Cryptocurrency Mining

A recent report by a local Iranian news outlet reports that the country's officials have approved cryptocurrency mining and further look to lift the ban on crypto be the end of September.

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Iran has maintained a stringent grip on the issue of digital currencies, and a ban has outlawed crypto trading in the country. However, in what may surprise many, the Iranian authorities have moved to recognize crypto mining as an official industry.

According to IBENA, a Central Bank-affiliated news agency, the government has approved the mining of virtual currencies and officially recognizes it as an industry.

A state agency official told the news outlet that the government and organizations in the crypto industry have agreed that cryptocurrency mining is acceptable.

Secretary of Iran’s Supreme Council of Cyberspace stressed that cryptocurrencies mining like bitcoin has been accepted as an industry in the government and all related organizations to the mining such as Ministry of Communications and Information Technology, Central Bank, Ministry of Industry, Mining and Trade, Ministry of Energy, as well as Ministry of Economic Affairs and Finance have agreed it, but the final policy for legislating it hasn’t been declared yet.

Iran to develop a crypto regulatory framework

Abolhassan Firouzabadi, the Secretary of Iran’s Supreme Council of Cyberspace, noted that the government’s approval means that the only thing remaining is developing a legal framework for the sector.

The framework will also include the final policies that will guide start-ups and other participants how to proceed. Although authorities are yet to make a final decision on the matter, the framework will be in place by September 22, 2018, IBENA reported.

Digital asset mining approval backed by many Iranian government agencies

Several government state agencies and ministries were part of the body that approved crypto mining in the country. They included the Central Bank of Iran (CBI) and many ministry representatives from economic affairs and finance, mining and trade, industry, communications and IT, and energy.

Crypto banned by Central Bank of Iran in April 2018

The Central Bank of Iran banned trading of cryptocurrencies in the country in April. According to the CBI, the move was meant to help fight the use of such avenues in money laundering and terrorism.

That ban is still in place, but local media reports suggest that the country is likely to lift the ban. The Financial Tribune quotes CBI’s Nasser Hakimi as saying that the Islamic state will soon formulate rules and policies intended to see more regulatory oversight in the crypto industry.

Just like the crypto mining framework, the lifting of the ban is expected to happen at the end of September.

Iran to potentially develop state-issued cryptocurrency

The Islamic state has seen some rapid development within the crypto industry in recent weeks. In August, the country’s Informatics Services Corporation (ISC) revealed the features of the national cryptocurrency.

The country wants to create a national virtual currency pegged on the state’s fiat currency Rial. The Rial-backed crypto is based on Hyper-ledger Fabric Platform technology, a private blockchain platform.

The non-mineable coin will be issued by the Central Bank, which has the discretion to decide on the volume of issuance.

IBENA reported that the implementation of the project will be in two phases. Phase one will have the new crypto used as a token as well as an interbank payment protocol.

The second phase will involve the use of the currency as an instrument to facilitate retail payments within the society.

The main reason behind the push to tokenize Iran’s national currency (rial) has been the possible effects of international sanctions on the country’s economy.

Alireza Daliri, a deputy at the Directorate for Scientific and Technological Affairs, told state-sponsored Press TV that the apart from facilitating the transfer of money, the state-backed crypto will the country “at the time of sanctions.”

The Informatics Services Corporation (ISC) and the CBI are already finalizing details to have the CBDC ready before the end of the year. The US-led sanctions on crude oil take effect in November and the Islamic state’s authorities are keen to stem the effects.

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