Iran Moving Toward National Virtual Currency

EghtesadOnline: News about Iran striving to launch its own virtual currency garnered mixed reactions and raised a number of questions, namely about the potential uses of the currency and the government’s role.

News ID: ۷۸۲۲۱۱

08 April 2018

“In my opinion, the nation’s digital currency must be created with a minimal amount of state interference and by designating assets as its backer,” Nima Amirshekari, the head of Electronic Banking Department at the Monetary and Banking Research Institute, told IBENA.

“We must not expect any profits or yields from these currencies in the initial step, as they must only be subjected to tests,” he added.

Minister of Communications and Information Technology Mohammad Javad Azari-Jahromi had said on Saturday that MBRI, affiliated with the Central Bank of Iran, is one of the entities involved in the national virtual currency project and in charge of overseeing it, according to Financial Tribune.

“The Department of Innovative Technologies at the central bank has started conducting studies and evaluations in this regard and this is one of the areas in which they have made good efforts, in addition to fintechs,” Azari-Jahromi added as part of his first online interview with media outlets.

After the head of CBI’s innovative technologies, Nasser Hakimi initially announced in October that Iran is mulling the prospect of designing its own virtually currency, the minister took to Twitter about two weeks ago to provide more details.

“In the meeting I had with the board of directors of Post Bank about digital currencies based on blockchain, it was agreed that the bank would do what is necessary to do a trial run of the country’s first digital currency using the capacities of the nation’s elite,” Azari-Jahromi tweeted, adding that the experimental model will soon be presented to the banking system for evaluation and confirmation.

Amirshekari believes that Iran’s virtual currency is still some time away and will require “ideal” conditions to be established, as “there are currently resistances and disagreements on the use and creation of these currencies inside the country”.

The MBRI official emphasized that the local virtual currency must not be compared to Bitcoin and said that in addition to studying the issue, various entities must prevent the publication of negative news because “that will prevent the progress of technology inside the country”.

Last week, Azari-Jahromi pointed to a number of challenges facing authorities in shaping Iran’s virtual currency, namely whether it should be backed by physical commodities. He added that regulations to be published by CBI in the coming months will be crucial.

Iran’s national virtual currency has yet to take form, although the minister said “we will witness good things in this regard during the next fiscal year” that begins on March 21.