Iran: Cryptocurrency Legalization Likely in Near Future

“The final decision has not been made yet, but a working group in the Majlis Social Commission is studying it to establish online exchanges for virtual currencies, mining of virtual currencies and what currencies will be declared legal,” Abolhassan Firouzabadi, the head of the High Council of Cyberspace, also told Fars News website.

His remarks came the same day–Saturday–and only hours after he attended an HCC meeting chaired by President Hassan Rouhani, which was mainly convened to discuss using “cryptocurrencies in the national economy”. The meeting, slated to be the first of many, also focused on opportunities of developing the national virtual currency and the possibility of using other foreign cryptocurrencies.

“The plan to create a joint national virtual currency for the purpose of economic transactions with allied countries is also on the agenda,” Firouzabadi said on Saturday on the sidelines of the annual ELECOMP exhibition that is underway in Tehran from July 28-31, according to Financial Tribune.

Barat Qanbari, economic deputy to the minister of information and communications technology, said in response to Firouzabadi’s signal that cryptocurrencies are likely to be legalized, as the ministry “supports any technology that will lead to the growth of digital economy” and backed the cryptocurrency use.

He said a cryptocurrency may also help the country combat imminent US sanctions, the first round of which is set to snap back in early August, but added that sanctions’ circumvention is not the main target here.

“The main issue is that new technologies lead to economic openings in the country and new instruments are aimed at decreasing the final costs of services,” Qanbari said.

On the other hand, Ferial Mostofi, a senior member of Tehran Chamber of Commerce, Industries, Mines and Agriculture, opined that employing cryptocurrencies can only be a small way out.

“To use cryptocurrencies, all the conditions and repercussions must be first evaluated, but at best they are insignificant and secondary solutions similar to swapping and bartering,” she told IBENA.

The Monetary and Banking Research Institute, affiliated with the Central Bank of Iran, and the Telecoms Ministry are currently developing the country’s national virtual currency that will be unveiled soon and used for bank transaction clearance on a private blockchain during its first phase.

The imminent reimposition of US sanctions seems to have united Iran’s various factions concerning the need to tap into cryptocurrency potentials. 

About two weeks ago, Majlis Research Center, a prominent parliamentary think tank, published what it called a prelude to Iran’s use and development of cryptocurrencies. In its report, the think tank called on all related entities, including the central bank, to join in and constructively regulate to tap into blockchain and cryptocurrency potentials.

The central bank is set to unveil its official regulatory framework for cryptocurrencies by the end of summer.