Key takeaways:
- As per the announcement made by the Monetary and Banking Research Institute, the pre-pilot stage of developing Iran’s CBDC has been finished.
- The executive emphasized that a possible digital rial would follow the same regulations as rial banknotes.
Iran is making progress with its plans for a central bank digital currency (CBDC), having finished the necessary study for the potential launch of a digital rial.
According to a formal announcement made by the Monetary and Banking Research Institute (MBRI), the research branch of the Central Bank of Iran (CBI), the pre-pilot stage of developing Iran’s CBDC has been finished.
The news was revealed on February 20 at the ninth annual meeting on electronic banking and payment systems by Mohammad Reza Mani Yekta, director of the CBI office overseeing payment systems. He mentioned that although Iran’s central bank wants to gradually adopt the CBDC pilot in its payment system, it plans to expand its scope. Mani Yekta stated:
“The pre-pilot phase ended successfully with valuable achievements. The project will soon be launched in other ecosystems and will be used by more users,”
The executive emphasized that a possible digital rial would follow the same regulations as rial banknotes. Mani Yekta also mentioned that the CBDC infrastructure would replicate some blockchain features and that a digital rial would be distributed to people and institutions.
Ten Iranian banks have allegedly applied to participate in the digital rial project, according to Mani Yekta. Banks such as Bank Melli, Bank Mellat, and Bank Tejarat were involved during the experimental period. According to reports, all banks and financial organizations in Iran will soon begin to provide electronic wallets for using the upcoming digital currency.
After conducting preliminary research for years, starting in 2017, the CBI began preparing to begin a CBDC pilot in January 2022. According to reports, the regulator began implementing a CBDC pilot in September 2022 to enhance financial participation and compete with international stablecoins. Iran and Russia are also working together to develop a stablecoin that will be supported by gold, considering the development of digital assets and the demands made on governments.
The “crypto rial,” Iran’s digital rial initiative, is pegged 1:1 to the Iranian rial, the country’s official currency. According to reports, the digital currency is powered by a platform called Borna that was created using IBM’s open-source corporate blockchain platform Hyperledger Fabric.
The Reserve Bank of Australia will shortly start a live pilot program for CBDCs, or central bank digital currencies. In order to investigate its potential applications and advantages, CBDC will be established in partnership with the Digital Finance Cooperative Research Centre (DFCRC).
