Cryptocurrencies could offer Iran way around Sanctions

These comments were followed by statements from Nasser Hakimi, the CBI’s deputy director of new technologies, who said in mid-November that the CBI was planning to examine its policies about digital currencies. Hakimi said, “Given that bitcoin and other currencies have not been introduced by the Central Bank as the official currency, as well as the risk of buying it and the activity of traders in this field, more precautions are coming into the market because of the possibility of malice.”

In early 2017, Hakimi had referred to bitcoin as an “opportunity” that should be exploited by the Iranian government. He claimed then that bitcoin and other digital currencies could be used by traders who failed to open lines of credit due to banking issues. In the meantime, Hakimi has also repeatedly warned about investing in bitcoin as a speculative investment tool and that it will witness fluctuations leading to losses for Iranian investors.

The above official statements underline the challenge of officially endorsing digital currencies in the Iranian economy. At the same time, a number of decision-makers view cryptocurrencies as an opportunity to manage some of the risks that Iran is facing due to bottlenecks in the financial sector. The question is whether the authorities will manage to overcome the diverse barriers to developing and using cryptocurrencies or whether it will remain in legal limbo.

From a technical point of view, according to deputy ICT Minister Nasrollah Jahangard, his ministry has already confirmed that it would have the technical capability to detect whether or not digital currencies are genuine, but the license would have to be issued by the CBI. Jahangard summed up the challenge, saying, “Because of the restrictions in international banking that Iran has faced, some believe that cryptocurrencies are a threat and others believe they are an opportunity.”

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