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(Kitco News) – The Iranian Chamber of Commerce has reported that the Central Bank of Iran (CBI) is planning to launch a pilot program for its central bank digital currency (CBDC), the crypto-rial, starting Thursday.
The crypto rial was designed to use blockchain technology to convert Iranian rial banknotes into a “programmable entity” that can be more easily settled across borders and around the world.
According to CBI Governor Ali Salehabadi, “The bank has the infrastructure and rules for the crypto-rial. Cryptocurrency is envisioned as a new type of national currency, like banknotes and coins, but fully digital.”
In addition to increasing ease of use, one of the key features of the crypto rial touted by the CBI is its high level of security.
“Crypto-rial has been designed to be easily traceable, and even if the data on the smartphones is hacked, the crypto-rial can be traced,” read the Iranian Chamber of Commerce announcement.
The CBI believes the crypto rail will help improve financial inclusion in the country and serve as a tool to help the economy compete with other stable currencies around the world.
This development in Iran is the latest to show the country’s increasing interest in blockchain technology and cryptocurrencies. In early 2022, the Iranian government approved the processing of cross-border cryptocurrency payments through the central bank’s crypto platform. On August 9, the first foreign trade deal in imported goods worth $10 million was settled using cryptocurrency.
Russia Lets Private Sector Explore Crypto Payments
On Monday, Russia’s head of the Treasury Department’s financial policy department, Ivan Chebeskov, discussed the country’s digital currency bill and said a framework for settlements should be put in place, while the details – like the list of currencies used and the list of counterparty countries – should be determined – is determined in practice.
“The Ministry of Finance has developed a bill on digital currencies, it’s comprehensive and includes many things,” Chebeskov said. “But in terms of payments, we’re creating a mechanism for companies rather than building that architecture outright, because it’s not totally clear how it should be regulated, so with this bill we’re giving businesses the ability to pay with cryptocurrency, but in terms of what cryptocurrencies will be used, how to negotiate with counterparties, with which countries it will operate – all this we leave for entrepreneurs.”
Chebeskov suggested that together entrepreneurs will be able to find the best way to make the system work more efficiently than the authorities could.
“And if that has to be raised to an intergovernmental level, then of course we will also get involved and push it forward somehow within the framework of international cooperation. However, since there are already requests from the company, we rather expect these to be work that the company has either already done or will do in the future,” the official said.
In the long term, the Russian Ministry of Finance sees a variety of applicable use cases for cryptocurrencies that go beyond use in foreign trade.
“The current restrictions are an impetus for us to use these technologies, including as a new mechanism for international payments. But in my opinion, this is only part of all the opportunities that both digital financial assets and digital currencies can offer,” said Chebeskov.
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