It is illegal to buy or sell cryptocurrency in Iran, the head of the country’s monetary authority has recently reminded citizens and businesses. However, the governor noted that mining cryptocurrencies and using them in payments for imports is not against the law of the Islamic Republic.
Top banker confirms crypto trading is still illegal in Iran
The purchase and sale of cryptocurrencies or the use of digital assets for investment purposes is prohibited, the Governor of the Central Bank of Iran (CBI), Ali Salehabadi, has recently told local media. At the same time, authorized persons and entities can legally mine crypto that can be used for international settlements, the official pointed out.
Referring to regulations adopted by the bank and other government institutions such as the Ministry of Industry, Mines and Trade two years ago, the CBI chief elaborated that it is legal for Iranian companies to pay for imports with cryptocurrency. He was quoted in a report by the English-language edition of the Iranian Labor News Agency (ILNA) on Friday.
Salehabadi’s comments came after Deputy Trade Minister Alireza Peymanpak on Tuesday announced Iran’s first import order using cryptocurrency as a payment method. The government representative, who also heads the country’s trade promotion organization, revealed that the Islamic Republic purchased goods worth $10 million using digital coins.
However, Iranian authorities are unwilling to allow crypto payments in Iran, and earlier this year Deputy Communications Minister Reza Bagheri Asl dashed any hopes of that. Crypto trading and investing is also not tolerated, and the government cracked down on local exchanges, allowing only banks and licensed money changers to use digital currency mined in Iran to pay for imports.
Since 2019, when the authorities in Tehran recognized mining as a legitimate industrial activity, a number of enterprises have been licensed to mint digital currencies such as bitcoin. But the energy-intensive production has been blamed for being one of the reasons for the increasing power shortages and blackouts across the country, especially during the hot summers, when consumption increases due to increasing demand for cooling, and the cold winter months, when heating needs increase.
As a result, registered crypto farms were asked to shut down their power-hungry equipment on more than one occasion in the past two years, while Iran Power Generation, Transmission and Distribution Company, Tavanir, went after illegal miners who were mining thousands of underground crypto . farms.
The illegal installations often run on subsidized electricity in residential areas. Last month, the utility promised strict measures against this type of unauthorized mining. ILNA cites an estimate by Iranian officials that claims a single bitcoin mining machine uses as much energy as 24 households.
In his interview, Governor Salehabadi also drew viewers’ attention to the CBI’s plan to introduce a “cryptoreal,” or digital central bank currency issued by the Iranian Monetary Authority that is expected to partially replace paper cash. In April, the central bank informed financial institutions of upcoming regulations related to the issuance of a digital rial, and indicated that it is preparing to pilot a CBDC.
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Lubomir Tassev is a journalist from tech-savvy Eastern Europe who likes Hitchens’ quote: “To be a writer is what I am, rather than what I do.” Besides crypto, blockchain and fintech, international politics and economics are two other sources of inspiration.
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