Iran, Central Bank and Crypto Regulations: Legal Challenges and Pending Sanctions Progress


The Central Bank of Iran recently released a draft on cryptocurrency regulations. The draft is available on the bank’s official website and is likely in Persian. However, according to various sources, the draft begins by first making clear legal rules that cryptocurrency usage as a payment method is still prohibited. The draft also notes, however, the bank is taking a positive position toward other areas in the blockchain space.

The draft also seems to fall short of assuaging some of the concerns faced by the country’s local cryptocurrency communities. Rather than improving the field for the financial market, the draft may actually be more restrictive for businesses and people who are looking to adopt crypto. For instance, the draft, among verifying that cryptocurrencies and other tokens are banned, also requires that if a cryptocurrency exchange operates, it must obtain a permit. Further, the draft also uses the word “forbidden” a great deal, suggesting that there is a risk of prosecution for violations.

The local community interestingly enough is pushing back. According to Hamid Babalhavaeji, a blockchain researcher,

“At the end of the day, it’s about coming up with creative ideas to make the best out of a restrictive framework. We don’t want to create any potential legal challenges for the central bank.”

There may be several underlying reasons for the bank’s and country’s position on cryptocurrencies, it is important to note that there are those who view that cryptocurrencies are a potential challenge on external restriction such as sanctions. For example, the country’s president Hassan Rouhani attended a number of cryptocurrency meetings and the bank is even considering a sovereign rial-based cryptocurrency. A former advisor from the Central Bank, Saeed Khoshbakt, who is now a CEO f a distributed ledger firm called Areatak, stated

“At the end of the day, it’s about coming up with creative ideas to make the best out of a restrictive framework. We don’t want to create any potential legal challenges for the central bank.”

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