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Four Iranian Banks Join Forces & Develop Gold-Backed Cryptocurrency

The Islamic Republic of Iran has finally jumped in the cryptoverse. According to the report on financial news website Financial Tribune on Jan. 30, four of the country’s banks, have developed a cryptocurrency backed up by gold, called PayMon.

In recent news, several countries around the world have been jumping on the crypto wagon, however Islamic countries and cryptocurrencies are apparently at two ends of the spectrum. The reason lies in the teachings of the Muslim faith, i.e. Islam. According to the Islamic or Shariah Law, Muslims are prohibited by their religion from the act of lending for profit on interest, in short usury.

Another stringent guideline regarding money, laid out in Islam is that commodities of intrinsic value or currency backed up by intrinsic value commodities such as gold or silver, is considered as legitimate currency. And Bitcoin and other cryptocurrencies are not backed by anything like that.

So in order to overcome those hurdles and to embrace what seems to be the future of the currency, Iran launched this gold-backed crypto. According to the article, the new crypto asset is a product of cooperation with the Parsian Bank, the Bank Pasargad, Bank Melli Iran and Bank Mellat. Purportedly PayMon will be listed on Iran Fara Bourse, which is an over-the-counter (OTC) cryptocurrency exchange. As per the reports, a billion PayMon tokens will be released initially.

According to the director of Kuknos, the blockchain company that is looking over the technical aspects of the project, the new crypto asset is a way to tokenize assets and excess properties of the banks.

Interestingly enough, earlier this January, Iranian lawmakers revealed that they were seeking to introduce a legislation that would block crypto from being used for payments within the country. In addition to that, the legislation would keep the citizens from having significant holdings.

Let’s see if this opens the crypto door for other Muslim countries around the world. For further updates, stay tuned to BlockPublisher.

Abeer Anwaar

Abeer holds a Bachelors degree in Media studies and covers blockchain startups for BlockPublisher. An optimist, excels in the art of the written word and swears by the joy of all things sweet. Contact the editor at editor.startups@blockpublisher.com

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