Page 34 - IRANRptDec19

from circulation.
“Truth be told, people no longer use the rial in their daily transactions,” he said.
7.1​ Cryptocurrency
Iran permits digital coin mining in a brushstroke
The Iranian government has approved a bill that recognises digital coin mining as an industrial activity. ​The development could lead to regulated business that could generate more forex revenues for Iran, the Iranian Chamber of Commerce said in a press release on July 29.
Iran has to date had a​ ​confusing relationship with cryptocurrencies​. ​Different factions of the country’s power structure are either for or against the cryptocurrency industry. In recent months, military officers also waded into the debate, saying the industry poses real threats to Iran. However, despite the misgivings, Iran, suffering punishing US sanctions, has changed tack and has welcomed cryptocurrency mining and trading in recent weeks.
The cabinet approved the bill after the government economic commission passed it early last week. The bill, however, does not allow the use of digital coins, such as Bitcoin, inside Iran, saying such transactions would not be supported by the Iranian banking system.
Iran’s Finance and Economy Minister Farhad Dejpasand said: “According to this commission's approval, the government recognised the phenomenon of digital currencies and there won’t be any prohibition on importing mining machines from now on.”
According to the approved plan, cryptocurrency miners must pay a higher price for power consumption, which is pushed up by computing power demands. Iran’s electricity industry government spokesman Mostafa Rajabi Mashadi has told media that the government is considering asking the miners to pay in US dollars “as their income is in dollars”, but it is not known if this is possible under current laws banning trade in dollars.
Dejpasand said the Central Bank of Iran (CBI) has been tasked with laying the legal and financial groundwork for digital coin mining in a bid to further regulate the emerging industry.
On January 29, an initial 13-page draft on regulating the use of cryptocurrencies in Iran​ ​was released by the country’s central bank.​ ​The draft reportedly suggests heavy oversight should be exercised by the Central Bank of Iran (CBI) while the market develops. “Version 0.0”, as the drafted rules have been dubbed, is meant to bring clarity to the utilisation of the global digital payment method and “allow traders to plan for their future”.
After initially banning the use of cryptocurrencies such as Bitcoin, the CBI now recognises the digital payment method as legitimate. It is also laying the groundwork for a future Iranian digital currency that it intends to launch.
34​ IRAN Country Report​ December 2019 www.intellinews.com