It was reported today that Venezuela’s no longer the only country with a near-working cryptocurrency. This Saturday, a Reuters report confirmed that Iran has an effective beta-version of a state crypto-currency ready for tested usage.
The government has elaborated on this by first stating terming it a “digital currency,” and not a “crypto currency.” Secondly, they made clear that it intends to be “cloud-based,” which seems to mean that its blockchain network will be held in a cloud and may not be fully decentralized.
Apparently, despite this seeming to indicate a looming, Iranian cryptocurrency in the near future, the Iranian government refused to confirm whether or not its proprietary currency would be made public. Secondly, they declined to comment as to whether the crypto-coin would be issued by Post Bank. Post Bank is already, effectively a key partner in the state’s development of the aforementioned
cryptocurrency but they are effectively owned by the Iranian government.
In opposition to the consideration related to Post Bank, there exists the current state of the Iranian economy, which most recently included 42,000 Iranian rials equaling 1 US dollar.
With such an unstable currency, it seems to be clear that a digital currency that caters to widespread adoption could be an effective stopgap. Even so, with the government’s relative silence related to details, it’s unclear just how experimental this currency is meant to be. It could be just another play by banks to dip their toes in the water without diving in head on. The project might not even have the aim of ever being market-ready.
With reports of comparisons already being made to Venezuela’s controversial state-crypto called the Petro and the falling rial, the Iranian government is already walking a fine line with their citizens and the world-at-large by even announcing a state-crypto.
It remains to be seen whether state-run blockchain projects of any kind can succeed but for this one to do so, it may have to gain initial support from other countries which are already leaders in the space. To do so, a relative level of decentralization is key but to date, no cryptocurrency has wanted to figure out exactly what this level is.
Overarching all of this is the fact that Iran apparently banned all financial institutions that deal in its national markets from working with cryptocurrencies. With all of this in mind, the entire project seems to be a gamble, at best, as of now.
By: BGN Editorial Staff