According to a report from Iran International, the Central Bank of Iran (ICB) has banned the trade of cryptocurrencies issued abroad. The move is believed to be an attempt by Iranian regulators to restrict capital outflow from the country. The West Asian country has previously banned the use of cryptocurrencies for payments.
The bank first legalized Bitcoin mining in 2019, and a year later, in October, asked registered miners to sell their tokens to the ICB. The country was facing various sanctions at the time and was having a hard time finding a way to pay for imports by overcoming foreign currency restrictions.
According to Fatemeh Fannizadeh, an independent Swiss lawyer who commented on Twitter on Friday:
“Crypto is already regulated in Iran. Mining is a legit industry, but trade is prohibited as I understand it. It just means that Iran wants to more aggressively export Iranian-produced money, encourage mining, and counter capital flight against the depreciating Rial. ”
In addition, it was reported that those trying to buy and sell cryptocurrencies that are no longer issued through legal channels will be liable for their own losses. The bank released an announcement on Wednesday, saying it will only allow locally issued cryptocurrencies for the processing of payments. From a logistical point of view, it is not clear how the ban will be implemented to keep foreign cryptocurrencies out of the country.
The abundance of oil and gas deposits in the country makes mining relatively easy, and laws passed by the Iranian government last year allow foreign crypto miners to stay in the country.
It should also be noted that the Central Bank of Iran is working to launch the digital rial, but has made little progress. At the beginning of the year, the bank confirmed that it is investigating the issue and reviewing its options.