IRAN: Central Bank Authorises Cryptocurrencies for Import Payments

Banks and licensed currency exchangers in Iran can now use cryptocurrencies to pay for imports. The country’s Central Bank, previously the only body that could use the currencies, has extended authorisation to selected financial institutions. However, only cryptocurrencies legally mined in Iran can be used.    

According to a recent report by the Financial Tribune, a non-governmental newspaper in Iran, the Central Bank of Iran (CBI) has given permission for lenders and registered foreign exchange shops to use digital assets for import payments. These financial institutions have already been notified by the central bank about the regulatory framework for crypto payments, says the report.

The new framework paves the way for businesses in Iran to use cryptocurrencies when making import payments, and could help Iran evade traditional financial controls as it wrestles with stringent international sanctions. In October last year, the Iranian central bank amended its regulations so that bitcoin and other cryptocurrencies could be mined officially. This is done under government control using subsidised energy, and the currencies are used by the government to fund imports. Now, the central bank has extended the legal use of cryptocurrencies to additional groups within the country. 

The government is drafting a bill to give regulatory clarity on various crypto-related activities, according to Mohammadreza Pourebrahimi, head of the country’s economic commission, and will determine the responsibilities of administrative bodies such as the CBI and the Ministry of Information and Communications Technology of Iran in this respect. 

Iran has become a leading hub for crypto miners. In 2019, it legalised cryptocurrency mining while issuing strict measures to regulate the activity. However, illegal miners are rampant across the country, with the government closing down over 1,500 unauthorised mining operations in January this year.