US Tables Bill for Sanctions on Iranian National Crypto

Lawmakers in the US have now tabled a bill to impose more sanctions on the financial institutions in Iran. This bill includes sanctions on the use of the country’s national cryptocurrency too. The bill, coded as HR7321, was tabled by Rep. Mike Gallagher at the House of Representatives on December 17.

Combating Money Laundering and Terrorism

The Blocking Iran Illicit Finance Act, as the bill is called, is a bid to combat money laundering as well as terrorism related activities through further sanctions on Iran.

If this bill gets passed, then all financing, transactions and other activities related to the Iranian cryptocurrency would be prohibited. Additionally, all foreign individuals involved in the sale of, supply of or even holding or transfer of this digital asset would not be allowed.

Over and above these sanctions, the bill also calls for a report to be given to the US Congress about the progress of the development of a sovereign cryptocurrency by the Iranian government.

Prior to this bill being tabled, a corresponding bill had been introduced on December 13 by the former Presidential candidate Senator Ted Cruz.

Sanctions on Iran

The American government had introduced sanctions in 2005 against Iran due to the country’s nuclear program. The House of Representatives as well as the US Senate had passed this bill, called the Comprehensive Iran Sanctions, Accountability and Divestment Act, in 2010.

This act led to the Iranian financial sector being barred from directly accessing the American financial system.

These sanctions were then lifted in 2015, after Iran acceded to controlling its nuclear proliferation program to comply with the standards set by the International Atomic Energy Agency through the JCPOA (Joint Comprehensive Plan of Action).

JCPOA is an agreement between Iran and other nuclear states called the P5+1. Countries that signed this agreement are the US, China, Germany, France, Russia and the UK. This deal was endorsed by the United Nations Security Council Resolution 2231.

However, in May of this year, American President Donald Trump withdrew from this agreement, which had been signed during his predecessor Barack Obama’s term. Once the US withdrew from the deal, sanctions on Iran was then re-imposed, hitting the country’s economy hard.

Iranians Turning to Cryptocurrency

In an effort to skirt these sanctions, many Iranians turned to cryptocurrencies. In fact, the head of Iran’s Parliamentary Commission for Economic Affairs, Mohammed Reza Pourebrahimi stated that cryptocurrencies were a promising way for their country to avoid USD transactions and maybe even replace the SWIFT interbank payment method.