Iran’s central bank is preparing to launch a pilot phase of its digital currency project in the near future, its new chief announced to local media representatives. The monetary authority is also preparing to move forward with a plan of law reform that conducts its own activities.
Iran prepares pilots for sovereign digital currency
Iran’s “national cryptocurrency” will soon enter its pilot phase, Ali Salehabadi, the governor of Iran’s central bank (CBI), recently unveiled. Speaking to reporters after the first meeting with lawmakers, the senior official said regulators are now researching the potential risks and benefits associated with the initiative. He explained, quoting IRIB News and the Financial Tribune:
The pilot trial will begin if the Money and Credit Council approves it.
Salehabadi, who has been the head of the CBI since October, did not provide further details on Iran’s central bank’s digital currency (CBDC). According to the English-language business daily, the new phase of the project may be in line with previous plans to develop a national crypto.
The report noted that three years ago, Informatics Services Corporation, a subsidiary of CBI, which operates the country’s banking automation and payment services network, was tasked with developing a sovereign digital currency. A CBDC prototype was designed using the hyperlaser fabric platform, a statement from its representatives was later released.
It became clear that the digital version of the national fiat of the Islamic Republic, Real, was evolving into a private blockchain. Unlike cryptocurrencies based on public blockchains such as Bitcoin, Iran’s state-issued currency will not be mined.
The public was never updated on the progress of this initial project until the recent announcement that a “crypto real” plan was underway. Officials insist that Iranian crypto is going to be a digital currency promoted by the CBI and not a decentralized cryptocurrency that can be used for small, cashless transactions, the release details.
New commission to amend Iran’s central bank law
In addition to the announcement of the digital currency, the Iranian media also learned that the new management of the central bank and the members of the Majlis had agreed to form a joint commission to reform the law relating to the CBI. Its members are expected to quickly finalize a long-awaited plan to update the law governing the central bank’s activities.
Governor Salehabadi added that a special working group would be formed to clarify the position of banks and the government on cryptocurrency. Although Tehran’s executive branch continues to pursue crypto investments and trading, allowing only banks and licensed money changers to pay for the import of coins mined in Iran, lawmakers have opposed the restrictive policy. They believe friendly rules will help Iran avoid US-led sanctions and improve its economy.
Mining is a crypto-related sector that has gained more clarity in terms of control. Iran recognized digital currency extraction as a legitimate industrial activity in 2019 and introduced licensing for businesses. And although mining farms have been blamed for the power crisis during this year’s scorching heat, the ban on approved crypto mining has been lifted, according to official power user Tabani.
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