The Central Bank of Iran (CBI) plans to launch a Central Bank Digital Currency (CBDC) pilot project soon.
According to a report by Iran’s Labor News Agency, the CBI deputy governor said CBDCs could help the country resolve financial inconsistencies.
The development of a sovereign digital currency in Iran started in 2018 at the Informatics Services Corporation, the executive branch of the CBI. The development phase is over and a pilot will be launched soon. However, CBI did not reveal many details about the time frame.
The Iranian CBDC is said to have been developed using the Hyperledger Fabric platform hosted by the Linux Foundation. Cointelegraph has contacted Hyperledger for comment but has not received a response at the time of publication.
Iran has experienced significant financial and economic difficulties due to heavy economic sanctions imposed by the United States.
Amid these problems, Iran turned to crypto and was among the first countries to legalize Bitcoin (BTC) mining in hopes of reviving the economy, however, it had to temporarily shut down mining operations on numerous occasions due to severe power shortages and blackouts.
Iran is also looking to use cryptocurrencies for international trade, hoping to circumvent trade sanctions. As reported by Cointelegraph, CBI and the Department of Commerce have entered into an agreement to link CBI’s payment platform to a trading system allowing businesses to settle payments using cryptocurrencies.
Currently, nearly 100 nations are working on a sovereign digital currency, while only a handful have reached the pilot stage. China is currently at the forefront: it completed the development of its CBDC in 2019 and is currently testing it en masse in various provinces and retail sectors.
Related: Iran halts licensed crypto mining to save energy for winter
France and Switzerland have conducted multiple cross-border pilots. South Korea, Japan and Russia are expected to conduct trials in 2022, while the United States is still in the discussion phase. According to the Atlantic CBDC tracker, nine nations have already launched their CBDCs, 14 are in the pilot phase, 16 are in the development phase, 41 nations are still in research and two nations have canceled their CBDC plans.
CBDC Development Tracker Source: Atlantic Council