In the wake of growing interest in the mining of virtual currencies in the country, the Iranian Government has introduced a new crypto law. The new crypto regulating act strives to safeguard the country’s interest and safeguard it from international sanctions.
In Iran, many people have decided to venture into the mining of virtual currencies as a way of earning internationally-accepted virtual currencies at a time the country is under sanctions from the US government.
The bill that has since been ratified and released by the Iranian Cabinet bans any cryptocurrency trade activities in the country outlining clearly the Governments position. Within the new law, the Iranian government states clearly that they do not recognize cryptocurrency as a currency and as a medium of exchange.
A section of the new law reads,
“The Government of Iran and the banking sector will not view virtual assets as legal tenders. The Central Bank of Iran will also not guarantee the value of virtual assets.”
Despite the negative news to crypto followers in the Arab country, the new law states mining of virtual assets will be allowed in the borders of Iran under certain conditions. Some of the terms the government is putting in place for potential miners include obtaining approval from the country’sMinistry of Industry.
Miners will also be required not to mine their virtual assets inside a 30-kilometer borderline of all provincial centers. For crypto miners residing in the capital Tehran and the city of Esfahan, they will be subjected to more stringent rules and regulations for reasons only known by the government.
According to the new crypto regulating law:
“Miners will have to comply with the rules and regulations that have been set by the country’s standardization and communication bodies that have stipulated the mining machines that can be used in the activities. Certain fees and tariffs will apply for the electricity used for mining the virtual assets.”
On the issue of electricity bills, the law gives direction authorizing mining firms to be charged power bills that are based on the prices that apply in the exportation of energy from Iran. What this means is that mining firms will be taxed like industrial and manufacturing companies in the country.
In situations where the mining firms return the proceeds, they get from exporting the virtual assets back to the Iranian economic cycle; they will be taxed differently from industrial and manufacturing companies. What this means is that the Iranian government will give them kickbacks.
According to the new law, foreigners who want to set up mining companies in the country will be allocated areas to do so in special economic zones by the country’s Ministry of Industry.
The new law comes into place more than a month after news emerged showing mining firms were sprouting up across Iranian territory in areas where electricity subsidiary was on offer.
Before the new law, crypto mining activities was a fast-emerging practice that was sprouting across the country. At the time, the country witnessed many unlawful cryptocurrency activities that prompted the authorities to act fast to come up with the law.
Recently, the Iranian provincial police conducted a crackdown that saw them seizing over 1,000 bitcoin mining machines in two mining factories that were abandoned. The crackdown operation was prompted to take place after the country saw the demand for electricity rising by over 7 percent in June.
In July (last month), the deputy governor of the Central Bank of Iran, Nasser Hakimi, made an official statement stating that the buying and selling of cryptocurrencies were considered unlawful in the country. Picking up from the same queue, Jamal Arounaghi, the Vice President of the Islamic Republic of Iran Customs Administration, made an official statement stating the agency’s position. Part of his statement reads,
“The IRICA has not issued any license or permit that allows the importation of any crypto mining machines in the country.”
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