The Central Bank of Iran says it is in no hurry to launch its central bank digital currency (CDBC) though it was expected to be unveiled today (Monday).
Mehran Mahramian, the CBI deputy governor for innovative technologies, said that the test phase of crypto-rial will be launched soon, but "will take place gradually…we are not in a rush to unveil the project," he told a press conference, ILNA reported.
Peivast magazine last month quoted an official from the CBI who said that the project had completed its pilot stages and would be launched on February 7.
According to the official, Bank Melli, Bank Mellat and Bank Tejarat were involved in the experimental phases. All banks and credit institutions are to start offering electronic wallets for the planned new currency.
Bank Melli and Bank Mellat have started buying and selling limited amounts of the crypto-rial. The Money Reserve Supervisory Board had approved 10 billion rials of the crypto-rial be minted for use in the pre-pilot phase.
The CBI has said that it “has in place infrastructure for the crypto-rial that is planned as a new type of national currency, like banknotes and coins, but fully digital.”
Elaborating on latest measure on the CBDC project, the senior CBI said, "We changed the name of the project to the Digital Rial, based on the Money and Credit Council decision.
There is some serious concern about the user experience [UX] of the currency, and we have made considerable improvements to this end.”
Asked about the possibility of using crypto-rial internationally, Mahramian said, "I neither approve nor reject the possibility of using the CBDC beyond our borders…The project has several possibilities and we are dealing with some technical challenges."
Apparently the market is eager to know more about the project and its features and services which will be announced in late February, he added.
Ali Abdollahi, the head of the National Informatics Corporation, stressed that forming a proper ecosystem for the crypto-rial is a prerequisite for unveiling the project. "All the components must be finalized before making it available to the public."
Issues like acceptability of the crypto-rial and the business plan of companies involved in the project are of high importance, he added.
Based on what is known about the CBI’s crypto agenda, the digital currency is not designed to compete with global cryptocurrencies. Unlike bitcoin and other cryptos, CBDCs are centralized, not anonymous and in accord with anti-money laundering requirements.
The move seeks to help expand financial inclusion and function as a powerful tool for the CBI to compete with other stable coins globally.
The digital currency is to be minted in a distributed ledger system, consisting of authorized financial institutions and capable of implementing smart contracts.
Distributed ledger technology (DLT) is a digital system for recording the transaction of assets in which details are recorded in multiple places at the same time. Unlike traditional databases, distributed ledgers have no central data store or administration functionality.
The CBI earlier provided some details about the project in a draft of a crypto-rial whitepaper. Even though the document contains valid information it does not really address concerns raised by economists and the experts.
The CDBC is set to be used for micropayments inside the country, but analysts say businesses are not yet ready or able to accept the new digital currency. Moreover, its user-friendly feature and familiarity with digital wallets and security must be palpable before implementation.
