An Iranian news agency named, Trehan News reported that Iran plans to introduce a gold-backed cryptocurrency. This news was released a week after the President of the U.S.A, Donald Trump criticized virtual currencies on a social media platform, Twitter. Trehan News reported the development on its Engish website.
In accordance with this, The Central Bank of Iran (CBI) has mandated the issuance of new cryptocurrencies. This information is according to Shanab Javanmardi, the CEO of Iranian Information Communication Technology (ICT) FANAP.
Shahab gave the description to this as follows:
“IRAN’S CRYPTOCURRENCY WILL BE SUPPORTED BY GOLD, BUT ITS FUNCTION IS SIMILAR TO OTHER CRYPTOCURRENCIES. THE CRYPTO ASSET IS DESIGNED TO MAXIMIZE THE USE OF IRANIAN FROZEN BANK ASSETS.”
A number of banks like Parsian Bank, Bank Pasargad, Bank Melli Iran and Bank Mellat have joined hands with a blockchain startup named Kuknos Company. This partnership has been in existence since early January of 2019. According to the reports by The Financial Tribune, this gold-backed cryptocurrency project will be named as Paymon.
The government of Iran had earlier this year showed some antagonism in terms of Bitcoin and cryptocurrency mining in general. The reason behind this hostility was the use of power which is a characteristic of crypto mining. Primarily, the power supply in Iran is subsidized and a number of miners took advantage of this to set up large mining farms.
A news agency, called Mehr news reported that the Central Bank of Iran is planning to ban the private cryptocurrency and encryption services. This step would create a similar situation like China. However, the status of Bitcoin in the legal system of Iran is still not clear. A number of government agencies have conflicting opinions on the same.
In the same light, Javanmardi prompted the government to maintain its policy of putting a limit on Bitcoin in Iran. The authorities got hold of 1000 bitcoin mining machines in the Province of Yazd alone last month.
The Government of America ironically accused the Iranian Government of using Bitcoin to circumvent sanctions. The reason behind this is, Bitcoin is an immutable currency and not subject to centralized control.
What do you think about the status of cryptocurrency in Iran? Would this status affect the status of crypto in the entire world? Let us know in the comments section below.