Is Iran closer to a digi-rial?

July 26, 2018
Chris Wheal

Iran is thought to be close to launching a national cryptocurrency in a renewed effort to bust US sanctions. Yesterday Press TV, Iran’s state-backed TV service, claimed the Iranian government was moving nearer to developing its digital currency. 

“We are trying to prepare the grounds to use a domestic digital currency in the country,” a spokesperson from the technological directorate of the Iranian Presidential Office, Alireza Daliri, told Press TV.

An Iranian market trader in Shiraz – would he accept a digital-rial?

“This currency would facilitate the transfer of money (to and from) anywhere in the world. Besides, it can help us at the time of sanctions.”

Capital flight caution remains

Iran’s relationship with digital currencies has been hesitant. The Iranians have been nervous about the risk of capital flight, by any route. But after looking at the use of cryptos to facilitate clearing bank transactions, crypto momentum from Tehran appears to be gaining.

If the Iranians manage to get their digital currency aloft it would join Venezuela’s Petro crypto on the global crypto currency stage (though the Venezuela move was in fact a move supported by Russian input – more or less a joint venture – though the Russians have downplayed their role subsequently).

Tehran businessmen have many pressures on them, not least new US sanctions

Mixed official messages

Any Iranian digital currency would likely be only truly effective if used within Iran itself, not outside it. Some Iranians have reported difficult access to crypto exchanges such as Binance while Iran’s own national currency has to face down an inflation rate of more than 120%. 

In December 2017, Iran’s anti-money laundering authorities put the clamps on any financial institution absorbing cryptocurrencies such as bitcoin or ethereum.

Elsewhere, North Korea is thought to be using crypto technology and crypto mining to get around US sanctions. Venezuela’s president Nicolás Maduro claims the country’s new cryptocurrency-backed national currency will come into circulation on 20 August.

Post written by Chris Wheal
Chris Wheal is editor of OpenLedger's news and features service. An award-wining business journalists himself, he runs a team of freelance journalists from across the UK and north America.

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