The governor of the Central Bank of Iran has announced the launch of a supposed Iranian “national cryptocurrency” named "RamzRial".
In a statement on Thursday, Ali Saleh Abadi said: “We previously announced RamzRial would go live by the end of September. In fact, the project started on a trial basis a few days ago.
“A limited number of people were given one billion tomans by Melli Bank and Mellat Bank, and two stores have been designated for the use of this cryptocurrency.”
Information published by Iran’s financial authorities and state media so far makes it clear that RamzRial is effectively an electronic cash substitute; one press release compared it to other cash alternatives like gold bullion.
It is not a mined cryptocurrency and can only be distributed by the Central Bank. The Central Bank also has exclusive control over access to the blockchain –unlike the “permissionless blockchain” used for other products like Bitcoin, which where this digital ledger is available to everyone.
The official IBENA news agency reported on September 3 that the purpose of introducing RamzRial was not for Iranians to invest in it or profit.
Instead, it said, it was “to monitor and improve transparency in individuals’ exchanges and transactions”. According to Abadi, the system was designed by the Central Bank and the Ministry of Intelligence.
Apart from increased surveillance, some observers have warned that RamzRial’s encrypted transactions will allow state-aligned parties to conduct hidden money transfers. Iran is already a high-risk jurisdiction for money laundering on the Financial Action Task Force (FATF)’s global register.
Last March, an official report by the Presidential Center for Strategic Studies concluded Iran might be able to use cryptocurrencies to get around sanctions, while also slowing the pace of foreign currency leaving the country.