Iran has enabled the use of Cryptocurrencies to make payments for imports into the country.
The country has been facing a socio-economic crisis for a long time due to US sanctions. With the Covid-19 problem, Iran’s economy seems to be struggling. Thus Cryptocurrency to the rescue!
Iran’s government finally reversed it’s legislation and opened its doors for cryptocurrencies to be used in funding imports.
The Iranian cabinet amended its existing rule on the use of cryptocurrencies. The digital currencies can now facilitate imports by the CBI. With the change, the legal cryptocurrencies would be used for source imports from other countriesThe currencies are only valid for an exchange on the imports and can be done exclusively through the Central bank.
Scrutiny Over Use of Crypto in Iran
Iran government had tightened its strings on Crypto as there was the use of subsidized energy in illegal mining, many scrutinies which lead to the nationwide crackdown. Officials then set several general rules for the benefit of Cryptocurrencies in the country. In August 2019, Iran legalized mining and trading of popular cryptocurrencies like Bitcoin, however, there was substantial check on the volume and trading sources.
The government is also analyzing the overall impact of digital currencies on the economic balance in the country. With the use of Bitcoin and other leading cryptos in imports, the Central Bank of Iran would be able to loosen the impact of the US ban on Iran for using the Dollar.
Bypassing International Sanctions
The use of cryptocurrencies for imports would bring another form of the transactional unit to the country since it is barred from using USD, which is the most used currency for foreign trades in the world. The Central Banks of several other countries like Russia and China, also plan to bring their own cryptocurrencies to promote economic activities between various countries.
Substantial Use of Cryptocurrencies in Iran
There is a substantial increase in Iran’s mining farms since people find digital currencies useful as they do not need any third party to mediate for payments. The government realized that there is no point in limiting crypto-assets and their transactions in the country with several thousands of Iranians using digital currencies now.