Iran’s cryptocurrency ecosystem suffers as the U.S. imposes more sanctions

Crypto-exchanges giants, Binance and Bittrex unofficially pullout from Iran after the imposed sanctions

It is not the first time the US has stifled virtual currency dealings in Iran

As stated by Sepehr Mohammadi, the chairman of Iran Blockchain Community, several crypto-exchanges, mostly from the U.S. have unofficially disregarded Iran as one of the eligible countries to use their services after the new sanctions enforced this Monday, Nov. 5th.

The U.S. unveiled its new sanctions on Iran in full extent targeting 200 members of the shipping industry and vessels, 50 banks and their subsidiaries and the national airline. This sanction is bound to affect Iran’s currency and hinder other affiliated trades with Iran.

According to Sepehr Mohammadi, many virtual currency exchanges have executed strict regulations on Iran nationalists after the newly enacted sanction. He stated:

“Some virtual currency exchanges have imposed restrictions on Iranian users, but no assets belonging to Iranians have been blocked.”

Although the assets owned by the Iranians haven’t been frozen, the imposed restrictions have toughened cryptocurrency trading in the country. Giants Binance and Bittrex are among the crypto exchanges who have pulled out their dealings with Iran.

Not the First Time

From the initial sanctions in July, Sepehr Mohammadi condemned the U.S. government on limiting the growth of digital currency in the country by seizing around $6 million worth of BTC owned by Iranians.

“Last year (2017), the remarkable volume of bitcoin which belonged to some Iranians was confiscated due to unspecific reasons by the Federal government of the United States, and the process of confiscation is still continuing,” he said.

During the sanctions announcement, the U.S. Secretary of State Mike Pompeo cautioned:

“It should be noted that if a company evades our sanctions regime and secretly continues sanctionable commerce in the Islamic Republic, the U.S. will levy severe, swift penalties on it, including potential sanctions. I promise you that doing business with Iran in defiance of our sanctions will ultimately be a much more painful business decision than pulling out of Iran entirely.”

Iran’s Next Action

As one of the leading oil producing nations, Iran has been looking to virtual currencies to curb the inevitable strains combating their oil market in the globe.

When Tehran was developing a cryptocurrency for the state in October, the head of Iran’s Civil Defense Organization, Brigadier General Gholam Reza Jalali hailed crypto pointing out its versatile merits and ability to counteract certain sanctions.

The digital currency backed by the state will have similar characteristics like bitcoin by using the online ledger – blockchain technology. However, its infrastructure will remain private thus people will not be able to it.