Iranian authorities are escalating their restrictions on cryptocurrency transactions as the national currency, the rial, continues to depreciate. The Central Bank of Iran (CBI) recently halted rial payments for crypto transactions, affecting over 10 million users in an effort to curb further currency devaluation.
CBI Strengthens Oversight
CBI has been granted full authority to regulate the crypto market, as confirmed in a recent high-level government meeting. President Masoud Pezeshkian reaffirmed the bank’s exclusive role in overseeing digital assets, emphasizing the need for stricter controls. However, despite the government’s stated interest in using crypto for international trade, no clear implementation strategy has been outlined.
Meanwhile, the Iranian rial has hit an all-time low of over 940,000 per U.S. dollar, prompting the central bank to inject more foreign currency into the market and crack down on illegal currency trading.
New Restrictions and Industry Response
CBI has imposed trading limits on cryptocurrencies, particularly targeting the stablecoin Tether (USDT). A proposed cap would prevent Iranian traders from purchasing USDT if its price surges more than 4% in a day. Additionally, many smaller crypto exchanges have been forced to comply with strict regulatory conditions, including providing proof of reserves and granting authorities real-time access to customer data.
Critics argue these measures sidestep deeper economic issues, pushing users towards underground markets and foreign exchanges. Local crypto executives warn that excessive restrictions will drive capital flight and hinder financial innovation.
Regulatory Uncertainty and Future Implications
Observers anticipate further regulatory constraints, including potential taxation on crypto transactions, as Iran struggles with a growing budget deficit. The Supreme Council of Cyberspace recently introduced a regulatory roadmap emphasizing “active control and countermeasures,” raising concerns over transparency and potential risks for users engaging in international transactions.
While officials claim these policies aim to “minimize risks,” experts believe the primary objective is state control rather than consumer protection. The tightening grip on crypto aligns with broader efforts to regulate digital finance in a country grappling with economic instability and geopolitical pressures.
