The Iranian government might be revising its regulations around digital currency transaction processors.
According to the Iranian publication ArzDigital, at a recent government meeting, “the Ministries of Energy, Communications and Information Technology, as well as the Central Bank, were tasked with following up on the issue of digital currency extraction [mining] and making the necessary plans.”
This indicates that the Iranian government is going to revisit its current framework around their transaction processing industry and adjust as they see fit.
Killing capital outflow
Iran’s Parliament recently published a proposal that would include digital currencies in its regulatory framework for currency smuggling and foreign currency exchange.
Iran’s parliament is looking for digital assets to be added to the currency smuggling and foreign exchange regulatory framework to reduce the amount of capital leaving the country. From 2016 to 2018, more than $59 Billion left Iran. According to Al-monitor, a publication that focuses on events that take place in the Middle East, capital began leaving Iran in mass after the implementation of the nuclear deal. In addition to the nuclear dear, political and economic instability have catalyzed capital flight.
By adding all digital assets to the smuggling and foreign currency exchange frameworks, individuals and businesses that work with digital currency would need to register with the necessary government agency before their digital currency transactions were considered legal. For instance, digital asset exchanges would need to register with the central bank of Iran for their business to be considered legal.
Iran was one of the first countries to officially recognize digital currency transaction processing as an industrial activity. Recently, the government issued a license that will lead to the creation of the largest transaction processing operation in their country. It will be interesting to see how the proposed amendment and potential revisions will affect Iranian digital currency businesses and mining farms. Iranian block reward mining operations currently account for roughly 4% of BTC’s monthly hash power.
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