Iran Seeks Refuge from Cryptocurrency amidst eminent threats of new sanction from the US
May 10, 2018 Posted / 165 Views
The chairman of the economic committee of the Iranian parliament recently revealed that the country is purchasing cryptocurrency worth $2.5 billion. This follows renewed threats of sanctions from the United States caused by US president Trump pulling out of the Iran Nuclear deal signed in 2015.
Cryptocurrency is expected to have a better price performance after it was revealed that the Iranian government is buying cryptos worth $2.5 billion. This announcement was made by Mohammad Reza Pourebrahimi, the Chairman of the Economic Commission of the Parliament of Iran last week.
Iran is among the countries with the smallest number of cryptocurrency users and countries central bank have banned all Iranian Banks and financial institutions from dealing with cryptocurrencies citing increased possibilities of money laundering and terrorist financing risk associated with the use of cryptos.
Iran has for a long time suffered the crippling effects of economic sanctions from the United States and its allies causing the country to have a low rate of economic growth over the years. In 2015 some of the sanctions were lifted by the Obama administration when a deal was reached with Iran. however current US president Donald Trump think the deal has done very little in trying to restrain Iran from developing nuclear warheads prompting him to pull the US out of the agreement. This now exposes Iran back to the full risk of economic sanctions from the US and its allies.
On the other hand, the Iranian Regime through the Economic Commision is experimenting on its own local cryptocurrency. ICT minister Azari Jahromi said he met with Iran central bank to discuss ways in which the pilot program of the country’s first government-backed cryptocurrency could be started.
According to the secretary of Iran’s Cyberspace authority, Mr Abolhassan Firouzabadi the country would become bitcoin if it was possible to be regulated by the government. Yet the sole design principle of bitcoin is to enforce freedom through the anonymity of finance transactions. Many countries find it difficult to accept bitcoin because of the same of the fact that the government almost have no control over it.
The central bank of Iran gave a statement after slapping a ban on cryptocurrency including bitcoin in the country saying that; The price instability of digital currencies coupled with an influx in the level of competitive business activities through pyramid schemes and network marketing made bitcoin market very unreliable.
Rising allegations indicate that the Iranian government has been utilizing bitcoin to evade sanctions levied on them by the US. However Iranian authority commented saying that accusation was not based on any form of truth hinting that the country has better ways of neutralizing the adverse effects of the sanctions levied on them.
The latest sanctions that will be imposed in a period of 90 to 180 days will be targeting Iran’s oil sector, aircraft exports, precious metal trade and would void the Iranian government of any attempts to obtain a significant amount of the US dollar banknotes.
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