Iran Cracking Down on Crypto Amid Economic Crisis

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Iran is tightening control over cryptocurrencies as its economy struggles with rising inflation and a weakening national currency. The latest restrictions have left millions of crypto users in the country facing new challenges. At the same time, this crackdown has added more pressure to the global crypto market, which has already lost $500 billion in value over the past week.

Iran Blocks Rial Payments for Crypto

Last month, the Central Bank of Iran (CBI) suddenly stopped rial-based transactions in all cryptocurrency exchanges. This move affected over 10 million crypto users, preventing them from purchasing Bitcoin and other digital assets using the local currency. 

The decision was aimed at slowing down the rial’s depreciation, as authorities fear people are converting their money into foreign assets to escape economic instability.

With inflation above 40% for years and international sanctions cutting Iran off from the global financial system, many Iranians have turned to crypto as an alternative. The crypto market in the country has been growing rapidly, with young investors hoping to profit from the booming digital asset space.

CBI Takes Charge, Tighten Crypto Rules

However, the government’s increasing control suggests a push to bring crypto under strict regulation. In a recent meeting, Iranian President Masoud Pezeshkian noted that the CBI is now the sole authority overseeing the country’s crypto market.

These new rules seem to be part of broader steps to stabilize the economy and prevent further currency decline. The CBI is also injecting foreign currency into the market while police crackdown on illegal trading. These steps show a strong push to control economic instability.

New Restrictions Target USDT

Following the ban on rial payments, the CBI also imposed new conditions on crypto exchanges. Some smaller platforms were forced to comply with demands like proving their reserves and granting real-time access to user data.

The central bank is also considering a major change for Tether (USDT), the popular dollar-backed stablecoin. It plans to introduce a 4% cap on daily price fluctuations. If USDT’s price rises beyond this limit, Iranian traders would be temporarily blocked from buying it.

These restrictions come as the Iranian rial continues to weaken, recently hitting a record low of 940,000 per US dollar. Authorities are taking strict measures to stabilize the currency, including cracking down on illegal currency trading in Tehran’s streets.

While crypto remains a lifeline for many Iranians, the latest regulations could make it harder for them to access digital assets freely.