Iranian president Hassan Rouhani has urged Muslim countries to establish a new cryptocurrency to reduce reliance on the US dollar.

Speaking at the opening ceremony of a conference in Kuala Lumpur with leaders from Turkey, Qatar, and Malaysia, Rouhani asserted that the United States has used economic sanctions as the “main tools of domineering hegemony” to bully other nations.

He instead proposed an Islamic financial payment network with other Muslim countries trading in local fiat and a new cryptocurrency, reports Associated Press.

Rouhani claims this will ensure the countries involved are not dependent on USD while also allowing them to weather the effects of market fluctuations.

Domestic turmoil

Iran has been in turmoil over the past month, with violent protests taking place across the country amid anger over a spike in gasoline prices following US sanctions.

Sanctions were put in place after Washington withdrew from Iran’s 2015 nuclear deal with the world’s superpowers last year.

It has been reported that at least 304 people have been killed in the anti-government protests, while waves of arrests have been made throughout the country.

Rouhani has said the US sought to cripple the nation with the “heaviest sanctions”. But despite this, the Iranian economy is on the up as it gradually reduces its reliance on oil.

“The Muslim world should be designing measures to save themselves from the domination of the United States dollar and the American financial regime,” the president said.

He referenced rising extremism as well as issues such as weak governance, poverty, and corruption as endangering sovereignty and opening the door for Western interference in Syria, Yemen, and Afghanistan.

Rouhani says if these countries could band together with their collective strength, they could deal with such problems.

He continued to propose establishing a joint fund to finance technological cooperation among Muslim nations and a joint research centre focusing on AI and cyberspace.

While the leaders of some Muslim countries were in attendance, notable absentees were Saudi Arabia, Indonesia, and Pakistan.

Interested in reading more stories about potential new government-backed cryptocurrencies? Discover more about the EU considering its own public digital currency in retaliation to Facebook’s Libra project.