New Crypto Exchange Rules Will Be Announced Soon: MP

EghtesadOnline: Rules for cryptocurrency exchanges are expected to be finalized in the near future, a lawmaker said.

News ID: ۷۸۷۷۴۵

03 March 2022

"There are several methods under consideration for the work of crypto exchanges. We have set tasks for the relevant state organizations and ministries, namely the Central Bank of Iran and ICT Ministry," Mohammad Reza Pourebrahimi, head of Majlis Economic Commission told EcoIran web TV.

"I want to assure the public that the issue of cryptocurrencies will be regulated in the near future. President Ebrahim Raisi’s government has also started work on this issue."

He referred to the widespread use of cryptocurrency in Iran and concurred that denying the popularity of digital currencies is not the demand of wisdom.

In 2019 the government recognized cryptomining as a legal industry. Miners had to apply for a permit from the Ministry of Industries. Trade in crypto is still banned even though recently the CBI said banks and licensed moneychangers can use the e-currency mined by authorized miners in Iran to pay for imports.

Last March and following stringent anti-money laundering measures, the CBI ordered Shaparak, the local payment settlement network, to block online payment gateways owned by crypto exchange websites.

In May 60,000 people involved in the crypto business signed a petition asking former president Hassan Rouhani to stop blocking crypto exchanges. Soon after media outlets published a letter from his office in which the CBI was asked not to block cryptocurrency exchanges.

Growing interest in mining and trading cryptocurrencies in Iran has prompted authorities to craft a roadmap for crypto business in its entirety.

However, the issue, experts say, is more complex than previous regulatory challenges. The obvious result has been that no state organization wants a role in this sector or accept responsibility.

To address the challenges, the Raisi administration has a proposal to regulate digital assets and cryptocurrencies and has asked private enterprises to send their views and suggestions.

Observers, however, are not impressed and say it fails to address drawbacks and deficiencies in the existing regulations that have long deprived the sector of the growth it deserves.

The new framework proposes setting up a centralized platform for monitoring and supervising the crypto market along with the IDs of users.

Establishment of a new company affiliated to the Ministry of Economy is in the cards to develop crypto infrastructure. The company, Mehr, will develop the monitoring platform and create a hub to link crypto exchanges to the supervisory system.

A stock market official recently said the capital market should genuinely consider use of blockchain technology as it can help address major needs and create new vistas for reviving the struggling bourse.

Miners' Problems

Meanwhile, authorized miners face hurdles including high power rates, contracts with power plants and suspensions imposed at the wish and whim of regulatory bodies.

Miners pay their electricity bills based on power export tariffs. In April the Energy Ministry revised regulations for cryptomining as per which 16,574 rials is charged for one kilowatt-hour. Tariffs are cut by half when household consumption is low and the grid is not under pressure as is the case in summer.

Rates double during restrictions like when power plants do not receive enough feedstock or undergo routine maintenance.

Last May the former government ordered a blanket ban on all cryptomining until the end of summer. Legal miners were allowed to resume operations in the fall, though their operations were interrupted again.

In December miners were again ordered to suspend their activities to prevent possible blackouts in winter.