Iran plans to launch a ‘crypto rial’ pilot by the end of August

Iran’s government is taking steps in preparation for the launch of a new digital currency, referred to as the crypto rial. The monetary authority in Tehran hopes to initiate the project’s pilot phase within the next two months.

The authorities of the Islamic Republic are taking the necessary measures to launch a pilot of the crypto rial as of Aug. 23, Governor of the Central Bank of Iran (CBI) Ali Salehabadi revealed.

As the Iran Front Page news portal reported, the top executive emphasized that Iran’s digital currency will be different from the decentralized global cryptocurrencies. It is solely designed to “replace the banknotes that the people currently possess,” he stated.

Further, Salehabadi revealed that the pilot project will initially cover just one of the country’s regions. The crypto rial, which has been under development for some time, will be eventually introduced to other areas of the Islamic Republic at a later, unspecified stage.

Back in April, the CBI announced it’s preparing for the upcoming launch of the central bank digital currency (CBDC) after informing Iranian banks and other credit institutions about the regulations that will accompany its introduction. They detail how it will be minted and distributed.

Iranian monetary authority will be the sole issuer of the crypto rial and will determine its maximum supply. The coin, based on a distributed ledger system, is maintained by authorized financial institutions and capable of supporting smart contracts, earlier reports said.

The new Iranian currency will be issued under the provisions governing the emission of banknotes and coins and will be available exclusively for transactions inside the country. The CBI will be in charge of monitoring the financial and economic impact of the digital cash and making sure it doesn’t negatively affect its monetary policies.

Also, the central bank io Iran insisted that the state-issued coin will play a role in establishing the presence of cryptocurrency in the country, where payments with Bitcoin and the like are not allowed. The announcement of its pilot phase comes amid dozens of central banks worldwide considering or already developing their own CBDCs.