Categories: Opinions

Iran Soon to Launch State-Backed Cryptocurrency to Sidestep U.S. & SWIFT Bans

Bitcoin (BTC) and other cryptocurrencies are widely known and hailed for their ability to bypass all the obstacles that come with jurisdiction restrictions and authorizations. On the other hand the United States is known for slapping sanctions. If you read between the lines, there is an opportunity in there and Iran is taking it.

According to the Local English-language news outlet Al Jazeera’s report on Jan. 27, there are chances that Iran will reveal its very own state-backed cryptocurrency later this week, at the Electronic Banking and Payment Systems conference, being held in Tehran. The annual two-day conference will commence on Jan. 29 and will be following the theme of “blockchain revolution” this year.

Considering the fact that Iran has faced fresh sanctions from the United States since the November of 2018, it is a pretty smart move. In fact the country has been planning to use blockchain powered financial tools in order to evade restrictions on it economic growth, for some time now.

However, the Trump administration’s ban isn’t the only factor that has steered the country in the crypto direction. In fact, the biggest blow to Iran’s economy came in November, when a few of its banks were barred form SWIFT, which is a global messaging system based in Belgium that assists cross-border payments.

The reason this was such a blow to the country was that countries that are barred by SWIFT are unable to pay for their imports or even receive any payment for their exports. Which obviously leaves a country in an economically crippled state.

It is expected that Iran’s centralized cryptocurrency will be launched in phases, the first being a Rial-backed digital token. Now, the token backed by Rial will help in local transactions, it will facilitate payments between local banks and other Iranian institutions. And if we go further down the road, it could also be used at a public level to pay for goods and services.

Theoretically speaking, this sounds like quite the ideal situation, but sources apparently are uncertain whether such a large-scale implementation will occur.

Even as central bank-issued digital currency [CBDCs] may never find widespread everyday use among the general public, they may be able to offer some new features to startups and developers that had to work with centralised bank APIs before them.

Yashar Rashedi, a blockchain developer at Iranian firm Radfa, told Al Jazeera.

Iran is amongst several other states in its endeavor to release centralized digital currency, lets see if it actually follows through and succeeds. For further updates, stay tuned to BlockPublisher.

This post was last modified on January 28, 2019 9:56 am

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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