Central Bank Of Iran Bans Domestic Banks From Crypto Dealings

The Central Bank of Iran has banned domestic banks from and other financial institutions from offering services to crypto firms or dealing in cryptocurrencies.

In a circular, the central bank said that the government’s money laundering committee had taken the decision in late December and it was now being put into effect. The bank further claimed that cryptocurrencies have the potential to become a tool for money laundering and financing of terrorism.

“Banks and credit institutions and currency exchanges should avoid any sale or purchase of these currencies or taking any action to promote them,” the central bank said. “It should also be noted that the offenders will be treated in accordance with the relevant laws and regulations.”

The crypto ban comes as a part of the recently introduced reforms by the Iranian government wherein the country formally unified its official and open market exchange rates in an attempt to halt plummeting fiat currency, the Iranian rial. The central bank has also put a limit on the amount of foreign currency an individual can hold in cash to €10,000 ($12,250 USD).

The Iranian rial plunged to an all-time low on concerns about a possible return of strict financial sanctions led by the United States. On May 12, US President Donald Trump will decide whether to restore US economic sanctions on Tehran, which could restore the harsh international controls on the country that were lifted in the 2015 nuclear treaty between Iran and six major powers.

Earlier this month, the Reserve Bank of India (RBI), the country’s central bank, also announced a similar ban and has given regulated entities three months to unwind their business relationships with crypto-related companies.

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