The Next Petro? Iranian Minister Reveals Cryptocurrency Plans

Iran's central bank is developing a cryptocurrency, though it has no plans to embrace bitcoin.

AccessTimeIconFeb 22, 2018 at 8:15 p.m. UTC
Updated Sep 13, 2021 at 7:36 a.m. UTC
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New statements suggest that Iran's central bank is developing a cryptocurrency that would be administered by the state government.

Information and Communications Technology Minister MJ Azari Jahromi made the announcement on Twitter Wednesday following a meeting with the bank's board of directors.

He described a meeting during which "digital currencies based on the [blockchain]" were discussed, adding that it was decided "to implement the country's first cloud-based digital currency using the capacity of the country's elite."

— MJ Azari Jahromi (@azarijahromi) February 21, 2018

The announcement is notable given that on Tuesday, the government of Venezuela – which, like Iran, is the target of U.S. financial and economic sanctions – launched its own cryptocurrency, dubbed the petro.

It remains to be seen how the Iranian project would, if realized, operate. If executed under the auspices of the Central Bank of Iran, the project would represent the latest effort to create a state-backed digital currency by an institution of that kind. A number of central banks, including those from Singapore, China and the U.K., among others, have also explored this area.

Whether the proposed cryptocurrency would be fall under regulations that are reportedly in development is also an open question.

from last November, Abolhassan Firouzabadi, secretary of the Iran's cyberspace authority, was quoted as saying that the country would "welcome" bitcoin if it were regulated. Iranian media sources report that the central bank says it does not recognize bitcoin as a currency.

These sources also indicated that the government rejects allegations that it has been utilizing bitcoin to evade sanctions and reiterated previous warnings regarding the risks associated with cryptocurrencies.

"The wild fluctuations of the digital currencies along with competitive business activities underway via network marketing and pyramid scheme have made the market of these currencies highly unreliable and risky," the bank was quoted as saying.

Iranian currency image via Shutterstock

Editor's Note: Some of the statements in this report have been translated from Persian. 

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