Iran Bans Cryptocurrency Trade As Nuclear Deal Deadline Looms

The Central Bank of Iran has announced a ban on all cryptocurrency trades.

Iran’s central bank has reportedly banned the trade of cryptocurrencies as well as their use in transactions. The prohibition applies to all financial institutions in the country.

The bank’s Public Relations Department apparently related that the ban aims to preempt the use of cryptocurrencies in laundering money and funding terrorism.

The move comes mere weeks ahead of a May 12 deadline when US President Donald Trump is due to decide whether the United States will withdraw from a 2015 nuclear deal that has seen increased international monitoring of nuclear sites in Iran, among other terms. Trump has, on several occasions, voiced his displeasure over the agreement.

Under the deal, sanctions levied against Iran by the United Nations, the US, and the European Union were lifted. Between 2012 and 2016, sanctions cost the country a reported $160 billion in oil revenue. While it’s unclear precisely how US withdrawal would impact the deal’s terms, reimplementation of the suspended sanctions appears to be among the possibilities.

From this angle, it’s plausible that the central bank’s announcement was issued, at least in part, in anticipation of the reintroduction of those punitive measures so that in the event of their renewal, Iranians would be prohibited from swapping weakened rials for digital assets, further devaluing the nation’s currency.

This is not the first time that Iran’s central bank has spoken out against cryptocurrency. On February 21, the institution released a statement indicating that it did not recognize the legitimacy of any cryptocurrency within the country’s borders and discouraging Iranians from purchasing such financial instruments, purportedly so that they would be shielded from risk.

In late December 2017, the head of the country’s Securities and Exchange Organization said that the body was “reviewing Bitcoin’s status for entering the country’s economy and has not yet reached a conclusion, so if any brokerage buys or sells the cryptocurrency, it violates the law.”

Also on February 21, it emerged that Iran’s ICT ministry might conduct trials around an Iranian-developed cryptocurrency.

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