Iran’s initiative to launch a state-backed digital currency has reached its final stage of development. The draft of the project has been prepared at the behest of President Hassan Rouhani, local news outlet Financial Tribune reported on Saturday, citing a government official statement.
Saeed Mahdiyoun, the deputy director in charge of drafting regulations for the country’s High Council for Cyberspace, has reportedly told the Iranian news agency IBENA that the draft document is now ready and will be officially announced soon. He added that idea of introducing a national cryptocurrency has been actively pursued in the recent meetings of the council.
Iran’s decision to develop a domestic digital currency was revealed last month and comes as a response to recent US-led economic sanctions and as a way to “facilitate the transfer of money” to “anywhere in the world.”
In May, US president Donald Trump pulled out of a 2015 nuclear agreement with Iran and simultaneously announced that the US would be reinstating prior economic sanctions on Iran, which cut off Iran’s access to US dollars, among other restrictions.
Iran’s move resembles Venezuela’s launch of its oil-backed digital currency – the Petro. More recently, president Nicolas Maduro has announced the launch of a new national currency which will be pegged to the Petro.
Iran has had a tumultuous experience with cryptocurrencies. In November 2017, the High Council for Cyberspace stated that virtual currencies were viewed as beneficial for Iran as long as they were regulated. At the same time, economic uncertainty, inflation and rial devaluation all have encouraged Iranians to turn toward digital currencies. They have bought an estimated $2.5 billion worth of cryptos. This led the government to crack down with measures including the blocking of access to foreign cryptocurrency exchange websites. The central bank has also banned cryptocurrency trading due to money laundering concerns.
Mahdiyoun revealed to IBENA last week that the authorities will soon remove the existing uncertainty around cryptocurrencies, since the Central Bank of Iran is set to introduce its official stance on the issue at the end of September.