The Iranian authorities are ready to give rewards for information about illegal mining

Endy Callahan

The Iranian authorities announced that they are willing to pay for data on illegal mining of cryptographic currencies. They have developed new rules for determining the cost of electricity specifically for miners.

Modern mining in Iran

When reporting about miners who use subsidized electricity for mining, Iran is ready to pay 20% of the withdrawn funds, which are intended to compensate for the losses caused to the power plant. This is the position of the Ministry of Energy. Under the new rules, digital coin mining outside the national grid cannot be performed during peak hours.

The average export of electricity in Iran is 8 cents per kWh. In the cold months, the price will be reduced by half, and in the hot months, it will increase to 16 cents per kWh.

Although Iran has officially allowed mining, the country's authorities have emphasized that cryptographic currencies are prohibited from being used as a means of payment. You can read about how appropriate it is to set up a cryptocurrency mining business in the article "Mining farm in 2020".

Official authorization of cryptocurrency mining in Iran

During a meeting of the Iranian Cabinet of Ministers held at the end of 2019, it was decided to consider the mining of cryptographic currencies as an industrial activity. For official mining, miners must obtain a license from the Ministry of industry.

Industrial activity in Iran is subject to taxation, and mining is no exception. The authorities plan to provide benefits to those who will export cryptographic currencies to other countries, and transfer part of the revenue to the budget. It is expected that owners of digital currencies will be independently responsible for the risks associated with them. The state will not provide any guarantees to miners.

Iran issues its PayMon cryptocurrency, which is backed by gold

Tehran, in partnership with 4 banks in the country, found an opportunity to circumvent international restrictions. For this purpose, a cryptographic currency was issued. It is called PayMon, which means "Covenant" in Persian. The coin is backed by the country's gold reserves.

Representatives of such financial institutions worked on the development of a new payment instrument: Bank Melli Iran, Parsian Bank, Bank Mellat and Bank Pasargad. It is planned to bring the asset to the Fara Bourse OTC platform of Iran.

According to Valioll Fatemi, who is the head of Ghoghnoos, the new cryptocurrency will be used to tokenize the assets of financial institutions. He believes that the first issue will be made in the amount of a billion tokens. According to Fatemi, the new payment method will be used to circumvent international sanctions, including to reduce the negative consequences of SWIFT's refusal to work with Iranian banks.

Iran is against Bitcoin payments, the ban is set at the legislative level

The Central Bank of Iran intends to establish a ban on the use of digital currencies as a means of payment that have not received appropriate approval. It will apply to Bitcoin and tokens linked to Fiat currencies, precious metals, and other products. The list of cryptographic currencies that have been approved has not yet been disclosed.

The Central Bank has banned the integration of cryptographic currency wallets with various services in order to use digital money. They can only be used for transfer or storage. Outside of Bank accounts, Iranians can store cryptocurrencies in the equivalent of up to 10,000 euros in total.

In the near future, the Bank of Iran will develop a list of cryptographic currencies that will be allowed for trading. Crypto exchanges will be required to issue the appropriate license, only in this case their activities will be legal. One of the goals of such actions is to protect Iran's national currency, the Rial, from competition with digital money.

The regulator's proposal shocked Iranian companies that work with cryptocurrencies. One of the experts made a forecast: "The impact of such decisions on businesses that settle with foreign partners in Bitcoin will be very negative. Identification has received a weak development, according to the new rules, businesses will not be able to officially use the cryptocurrency."

What is known about the Iranian cryptocurrency PayMon

The development of Iran's digital currency has been discussed since February 2019. Then it was said at the beginning of testing a coin will be backed by gold. According to news agencies, private companies in Iran are engaged in mining.

Shahab Javanmardi of the Iranian Parliament said,  "Iran's payment system is based on encryption. It will facilitate the use of frozen assets of financial institutions in our country." The legislator owns FANAP. This IT company is part of the Pasargad Financial Group, and the Bank with the corresponding name participated in the development of PayMon.

It is expected that the digital currency of Iran will help the government bypass international sanctions, especially from Washington. Donald trump may impose a ban on us citizens and businesses using the PayMon coin. He has already taken this step in relation to the Venezuelan cryptocurrency El Petro.

Tensions between Iran and the West are rising. A British tanker was detained in the Strait of Hormuz. The official reason is a violation of international Maritime law. Representatives of Iran noted their readiness for any development of events, even for military actions.

The Iranian authorities have paid close attention to mining and the use of cryptocurrencies. The bans imposed can be used to help create a national digital currency, PayMon. It is being developed by the Central Bank of Iran and 4 local financial organizations. Our portal will continue to keep you up to date with the latest news in the crypto industry. Stay tuned!