TEHRAN (Dispatches) - A blockchain and cryptocurrency research lab has been set up in Iran, says the head of the company contracted by the Central Bank of Iran to design and develop a national digital currency.
Despite rising interest in cryptocurrencies, Iran has been slow to embrace them, but CEO of Informatics Services Corporation Seyyed Abotaleb Najafi believes they can help expand banking services in the face of marauding U.S. sanctions.
Iran’s central bank has contracted his company to gather information on blockchain and cryptocurreny technologies and establish a research lab, he told a conference on electronic banking and payment systems in Tehran Wednesday.
Blockchain is a digital ledger or database where transactions in Bitcoin and other cryptocurrencies are recorded.
On Tuesday, financial services giant JPMorgan said the most meaningful impact of blockchain will probably be three to five years away and mostly on trade finance.
"Blockchain isn’t going to reinvent the global payment system, but it will provide marginal improvements,” JPMorgan’s chair of global research, Joyce Chang, told Bloomberg.
According to Iranian media reports, a state-backed national cryptocurrency backed by the local fiat unit, the rial, has already been developed but it has yet to be approved for use by the central bank.
Iran’s currency was targeted by the first round of U.S. sanctions imposed in May after President Donald Trump withdrew from a landmark 2015 nuclear deal.
Under U.S. pressures, the global banking network SWIFT has dropped Iran from its platform, making international financial settlements with the country almost impossible.