Iran appears to be trying to ban cryptocurrencies extracted from foreign mines for payments

In a broader effort to circumvent the effects of sanctions, Iran may attempt one of the earliest cases of digital currency protectionism.

According to a Tweet from the Iran International news agency, The Iranian central bank announced a cabinet decision on Wednesday stating that the digital currencies traded in the country must also be dismantled or “dismantled” there.Preventing the exchange of digital assets extracted abroad.

While many observers have stated that enforcement would be nigh on impossible, blockchain lawyer and advisor Fatemeh Fannizadeh noted that the ban could be primarily aimed at banks and forex companies that use crypto to pay for imports:

I don’t think it applies on an individual level. Exchange platforms cannot function in principle. But instead of a total ban, leave the banks! and forex bureaus to use Iranian cryptocurrencies for international transfers. Iran is not connected to the SWIFT network …

Iran appears to be trying to ban cryptocurrencies extracted from foreign mines for payments
Iran appears to be trying to ban cryptocurrencies extracted from foreign mines for payments

end of April The Iranian central bank has ratified regulations that allow banks and other financial institutions to use cryptocurrencies to pay for imports. In this frame Institutions can use cryptocurrencies from government-licensed mining operations for purchases. This new regulation appears to aim to ensure that only cryptocurrencies that have been mined by approved farms are used for imports.

As of 2019, regulators have issued more than 1,000 licenses for crypto mining facilities, including a 6,000-piece farm operated by Turkey.

The new laws could be part of a broader sanctions strategy that has been in the works for years. Iranian research institute Majlis Research Center has urged the country to use cryptocurrencies to circumvent crippling economic sanctions since 2018, writing in a report that digital assets could be used for international trade:

“According to experts, one way to avoid the adverse effects of unfair sanctions is to use cryptocurrencies for foreign trade.”

Despite these new efforts to create a state-sanctioned payment channel for crypto imports, Iran’s relationship with digital assets has been at times shaky in recent months. In January, officials blamed widespread power outages for illegal crypto mining facilities, although experts said the flaw was most likely a broken and long-ignored infrastructure.

Similar Posts