Iran Said to Bar Banks from Bitcoin Market

The Central Bank of Iran is the latest national bank to sound the alarm on the cryptocurrencies, fearing of its misuse in money laundering and fraud.

AccessTimeIconApr 23, 2018 at 1:30 p.m. UTC
Updated Sep 13, 2021 at 7:51 a.m. UTC

Iran's financial businesses should not deal in bitcoin or other cryptocurrencies, according to the country's central bank and one of its principal market regulators.

Fearing the possible illicit use of cryptocurrencies in money laundering and terrorist financing, the Central Bank of Iran (CBI) sent out a circular on Sunday to prohibit the use of the technology within financial institutions, the country's national news agency reports. The announcement, made public yesterday, was passed by Iran’s anti-money laundering body in December, 2017.

The publication warns:

"Virual currencies have the option to be used for money laundering, supporting terrorism, and exchange of sums between wrongdoers."

According to the report, banks, credit institutions and currency exchanges must now avoid the sale or purchase of cryptocurrencies, as well as taking any action to promote them.

Still, it remains unclear to what extent the central bank is able to block domestic cryptocurrency activities given both the availability of the technology and the supportive views held by some public officials.

The country's Information and Communications Technology Minister, for example, revealed in February, that Iran's central bank is developing a cryptocurrency that would be administered by the state government.

In comments from last November, the secretary of the Iran's cyberspace authority went so far as to say the nation "welcomes" bitcoin, provided there are proper regulations.

And earlier, Central banker Naser Hakimi, deputy director of new technologies, made remarks in November that the central bank is studying bitcoin and that it plans a comprehensive review of its policies in this area. His statements however, were focused on the "uncertainty" and "risk" brought about by cryptocurrency speculation in the market.

Iran map image via Shutterstock

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