Iran’s defiance of the US sanctions and its entry into alternative financial systems is creating inroads for cryptocurrencies. After being sidelined from the Belgium-based global banking and finance system SWIFT, the country is left with few options to handle payments and remittances internationally. Cryptocurrency could be a way to sneak into the global financial system from the back door while reducing costs and ensuring cross-border trade at higher speed.
Depending on Cryptocurrencies
Iran has previously tried to create a state-backed cryptocurrency that could help it in maintaining its financial health should the traditional infrastructure crumble completely. Now, Abolhassan Firouzabadi, Secretary of Supreme Cyberspace Council, said that a decision-making body is working to establish a framework and final policies for trade and start-ups in the crypto market to be declared by the end of September.
According to Firouzabadi, the National Cyberspace Center could rope in the central bank as a trustee in the field of foreign exchange. However, the central bank of Iran affiliated news agency IBENA reports that “no definitive decision has been taken yet.”
Firouzabadi further commented that the idea of a national cryptocurrency is promising and that the government can use it to facilitate transactions with the country’s trade partners and friendly states amid US sanctions.
Bitcoin Mining Becomes an Industry
The Secretary of Iran’s Supreme Council of Cyberspace confirmed that the government and some government authorities had accepted crypto mining as an industry. These entities include the Central Bank, Ministry of Communications and Information Technology, Ministry of Energy, Ministry of Economic Affairs and Finance, and Ministry of Industry, Mining and Trade.
Iran’s march into the cryptocurrency world mimics that of Venezuela. Sitting atop the largest stockpile of oil in the world, the troubled economy of Venezuela tried to revive itself by launching a state-backed cryptocurrency— Petro. It now faces economic sanctions from the US.
Iran can take a cue from Venezuela and develop its own digital currency. The Iranian trade partners could use this currency. Whether or not the currency is adopted by an average Iranian remains uncertain. But at a macroeconomic level, the crypto could free the nation from US’ sanctions. Moreover, using digital currencies will help Iran in making cross-border payments more efficiently and stand on its own amid global political pressure.
Iran Confers ‘Industry’ Status Upon Crypto Mining Activities was originally found on [blokt] – Blockchain, Bitcoin & Cryptocurrency News.