In the face of massive sanctions, top Iranian official believes cryptocurrency is a solution. The country is now looking to launch its CBDC in a pilot phase.
CBDC headlines have been dominating fintech media for quite some time. Several countries are working on a national digital currency, but only a handful of them have landed in the pilot phase. Iran is the latest country that is gearing up to roll out its CBDC pilot soon.
According to the latest report published by the Iranian Labour News Agency, the Central Bank of Iran (CBI) intends to launch a CBDC pilot phase shortly. The official did not disclose any specific timeline for the same. The report also mentioned that the CBI Vice Governor for IT Affairs Mehran Moharamian sees cryptocurrencies as a solution to the growing financial instability across the world.
Interestingly, the cryptocurrency industry in Iran is not regulated. However, the central bank of the Western Asian country had permitted domestic banks and money exchange platforms to use cryptocurrencies generated by authorized miners in the region to pay for imports. In fact, the CBI first started to work on developing a digitized version of its national currency in a bid to circumvent economic sanctions imposed by the United States as well as to enable cross-border transactions.
The development of Iran’s national digital currency began in 2018 at the Informatics Services Corporation (ISC), CBI’s subsidiary and private joint-stock company. ISC officials had revealed that the Iranian cryptocurrency was being designed with the help of the Hyperledger Fabric platform. For the uninitiated, Hyperledger is a multi-project open-source platform hosted by The Linux Foundation. It was built to foster cross-industry blockchain technologies.
Iran Cryptocurrency And Blockchain Ecosystem
The Iran Chamber of Commerce, Industries, Mining and Agriculture (ICCIMA), under its supervision, established Iran Blockchain and Cryptocurrency Association (IBCA) last year. The primary goal behind the organization was to tackle challenges faced by the country’s rapidly growing cryptocurrency and blockchain ecosystem.
The formation of IBCA follows the suspension of the Iran Blockchain Association (IBA) by the Ministry of Interior in June 2021 for allegedly violating its articles of association.
Besides, Iran has been known to be one of the world’s most crypto mining-friendly countries. But, the lawmakers had imposed a temporary blanket ban on crypto mining in the summer last year, subsequently lifting them in September when the Iranian power grid became more stable. Two months later, the Iran Grid Management Company announced halting authorized crypto mining to save energy for winter again.