Tehran, Iran – Iranian authorities have once again cracked down on cryptocurrencies and online exchanges as the value of national currency values in a chaotic economy.
Last month, the Central Bank of Iran (CBI) suddenly stopped paying for rial on all cryptocurrency exchanges, causing more than 10 million crypto users to spend it on Bitcoin and other global online currencies.
The goal was to counter the further depreciation of the national currencies fought by stopping foreign currency changes.
The crypto market grew significantly last year and leaned towards a bullish 2025 2025, leading countless young Iranians to a growing global market, making money in most isolated economies that are tense under harsh Western sanctions.
This move, which has been tested previously at a limited time, appears to be part of a larger governance effort by facilities that want a tighter level of control and monitoring of the fast-growing crypto community for a long time.
The economy is plagued by an inflation rate of over 40% per year and remains detached from the global payment system.
CBI establishes permissions
After imposing the block, the central bank mostly maintained radio silence and did not provide clarification to the general public.
The CBI also did not respond to Al Jazeera requests for comments.
In an official statement, CBI Governor Mohammad Reza Farzin attended a meeting of the heads of the government, judiciary and parliament last month, simply noting that during that meeting the CBI was given “full authority to monitor and manage the cryptocurrency market.”
President Masoud Pezeshkian sent a letter published on Media to Farzin last week, highlighting that CBI is the “only trustee” of the crypto market.
Last month’s meeting also concluded that the government wants to increase export trade that brings cryptocurrency to the Iranian market, but has not shown how this will be achieved.
The new restrictions appear to be part of a strict measure to prevent currency depreciation, with the CBI putting more foreign currency into unstable local markets, and police regularly announce the arrests of illegal currency traders on the streets of Tehran and other major cities.
Iranian Rial continued its slide this week, reaching a new all-time low of over 940,000 per US dollar. In October last year, there were less than 600,000 rials under $1, and in early 2018 it was less than 40,000.
The domestic currency has fallen sharply in recent weeks amid escalating regional conflicts, a blow to the Tehran-led “axis of resistance” and Donald Trump’s claims on the “maximum pressure” campaign.
4% cap for USDT?
A few days after the sudden decision to ban real purchases of cryptocurrencies, the CBI imposed conditions on the online exchange and began negotiations with them.
Many small exchanges were forced to accept at least some conditions, including providing evidence of reserves. Some people are restoring their real gateways with limited capabilities, while others are still negotiating.
Some of the “suggested measures” by CBI consisted of the top level of access to customer information, including real-time access, constant updates and the ability to block users whenever they deem necessary, according to a document reviewed by Al Jazeera.
Similar to the artificial restrictions the regulators have set up to trade on the Iranian stock market, the CBI expects to impose a daily cap on how much the real price of cryptocurrency can change.
Real trading will be suspended for a short time if a currency moves beyond a defined limit.
Central banks are particularly focused on the dollar-covered stablecoin tethers (USDTs) that many Iranians buy as hedges.
If the price of USDT increases by more than 4% in a day, we want to ensure that Iranian traders will temporarily block them from purchasing it.
“Rationality not an agenda”
As a result of the sudden blocking of the Real Gateway, some crypto exchanges have been forced to start looking for temporary alternatives, such as using different bank accounts to facilitate real payments.
Incoming and outgoing crypto transactions are not affected and can be retrieved from your account if the user chooses.
Central banks are facing criticism, and former central bank chief and presidential candidate Abdulnaser Hemati is currently being targeted by a bluffing MP by hardline lawmakers. The government argues that the efforts of the ammo each will be politically driven, as lawmakers want to remove the minister just a few months after he started.
Rather than addressing its own imbalances in a rocky economy, the CBI employs strategies to distract attention and try to make money through online exchanges, the local exchange director said.
“We have not been listening to repeated warnings about the unfavourable political, social and economic impacts of such moves provided by stakeholders and the media. Ubitex CEO Eisa Keshavarz told Al Jazeera that the central bank has shut down payment gateways with an unethical and biased approach to business.
He said the establishment, on the other hand, has blocked foreign services like social media platforms and forced Iranians to local platforms, but it will drive people to foreign exchange with a restrictive move against local counterparts.
“These dual policies show that rationality, clear thinking and empathy with people are not on the agenda, which broadens the gap between people and government.”
Keshavarz said people rely on informal underground activities as a result of restrictions.
“It was nowhere else to turn their hard-earned money into gold, greenback, crypto, or anything to keep their hard-earned money in gold, greenback, crypto, or anything,” he said.
“Minimize risk” for whom?
CBI and others have made past attempts to regulate the fast-growing crypto industry. Almost everything was perplexed by confused or annoyed stakeholders.
The government created Crypto Mining (the process of using calculation power to generate new coins) in 2019, legally and legally under strict conditions.
Many miners were kicked out due to repeated cutoffs of mining rigs, particularly due to power shortages.
Observers and experts believe regulators facing a growing government budget deficit will move to taxing crypto transactions.
The Supreme Council of Cyberspace, Iran’s top internet governance organization, last month released a regulatory roadmap that observers do not portend the crypto community.
We discuss “promoting international trade” through code. This could be interpreted as an attempt to avoid Iran’s sanctions, according to cryptography and blockchain researcher Saeed Khoshbakht.
“This could put crypto users at risk of being blacklisted, especially after Trump’s election,” he told Al Jazeera.
Experts said that using international transactions as a keyword in documents could lead to major domestic crypto transactions being considered confidential and less transparent, which could result in less auditing.
At the same time, regulatory documents employ a “active control and countermeasure” policy when dealing with global cryptocurrencies that they claim to “minimise risk,” but have not said exactly who or for whom.
“If you say that it’s minimizing the risks for citizens, then at least some support is expected. But without this phrase, “minimizing the risk” appears to be focusing on the nation, not the people. This means many new restrictions hidden as control and control,” says Khoshbakht.
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