Iran is about to release its first central bank digital currency (CBDC), which will be pegged to the value of the national FIAT currency, the rial, at a rate of 1:1.
This development, many in Tehran hope, will strengthen the country’s economy and provide it with a way to continue to fight sanctions.
Tehran has been actively looking to use digital currencies to circumvent many of these sanctions and succeeded insofar as private cryptocurrencies go.
But private cryptocurrencies are not centralized, and Tehran wishes to launch its own CBDC, similar to the Chinese digital yuan, which can help it stand its ground.
In fact, the digital rial is built on a distributed ledger technology platform, which means that the central bank will be in full control of who can access the rial.
There has been growing awareness for digital currencies. In Australia, a politician suggested that the country should prepare to accept the digital yuan in some form.
El Salvador has gone ahead with Bitcoin as an official tender, and other nations are speaking of similar moves.
Iran’s task is not without its challenges, reports Al Jazeera, which cited the Iranian central bank which revealed concerns over privacy, anonymity and anti-money laundering procedures. These concerns are also shared elsewhere.
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