Iran’s Rial-Backed Cryptocurrency Uses Hyperledger Fabric, Rolls Out Features Amid Financial Crisis
Iran Unveils State Cryptocurrency Amid Financial Crisis
The concept of a cryptocurrency was not always as mainstream as it now is. In fact, the founders of Bitcoin, the first cryptocurrency, were relatively deadest in libertarian and anti-establishment ideology. The currency was created as a response, in part, to dissatisfaction within the current economic system in much of the world. But as the cryptocurrency ascended in value and technology became more sophisticated, major institutions around the world have become more interested in the idea of adopting the once-fringe technology for themselves.
This past year, the cryptocurrency community was shocked in the best of ways with the news that Venezuela would be using Dash as its official cryptocurrency, making the startup the first cryptocurrency to be adopted by a major nation in the world. But this choice did more than just excite investors in Dash. The decision to adopt a cryptocurrency finally set the precedent that cryptocurrency might be a viable option for countries that fall into an economic crisis of some sorts.
This concept has been further expounded upon by the recent choice by Iran to create and integrate their own cryptocurrency into their existing financial infrastructure. The Informatics Service Corporations is a banking organization within Iran responsible for the creation of a centralized cryptocurrency within Iran, and the integration of this new currency into their existing structure, economy, and political system.
The precedent for cryptocurrency as an alternative to floundering fiat economic conditions is relatively new, but it grows stronger with each country that adopts the technology. Venezuela has seen some of the worst inflation in the history of the country, with projections outlining that the country might have seen inflation rates of over 1,000,000% this year alone. In response to the issue, the government capitalized on the lack of faith of the average citizen in the fiat economy by adopting Dash as an additional form of payment.
For Iran, though, the situation is slightly different. Dash remains a largely decentralized blockchain and is a private company. For Iran, the solution comes from their own country, rather than from an outside fintech startup organization. Regardless, though, it seems that the most important technical aspect of this setup is that the country will be using centralized blockchain technology as an ecosystem for existing Iranian banks and cryptocurrency companies.
The Digital Rial
According to a report from the deputy director of the SCC, or the Supreme Cyberspace Council, released an official statement outlining that the agency will be responsible for regulating the draft of this new digital currency, known as the Digital Rial. The executive believes that this digital currency will allow the country to escape the detriments of the Trump administration’s work to undermine the country economically.
A Geopolitical Response
The creation of this particular cryptocurrency is interesting because, unlike the founding of the Venezuelan system, the Digital Rial has been created solely as a result of increasing political pressure from the United States. As President Trump turns up the dial on the Rial, Iran is working overtime to try to find creative solutions to escape the pressure and maintain the upper-hand. Cryptocurrency might just be this creative solution.