Iran Increases Censorship Of Cryptocurrency Exchanges, Iranians Still Find Ways To Trade Crypto

  • The Iranian government has reportedly increased its censorship of cryptocurrency exchanges, due to concerns over their use in the flight of capital from a country crippled by US-led sanctions.
  • Anonymous local crypto traders report that Iran’s government is attempting to restrict access to cryptocurrency exchanges, but people have still found ways to trade and purchase digital currencies.

An anonymous Bitcoin supporter from Iran recently revealed that every cryptocurrency exchange in the country has been “filtered since May.” The crypto advocate was referring to the recent decision by the Iranian government to censor information related to the cryptocurrency market, which has come just before the expected renewal of internationally imposed sanctions on Iran next month.

A number of Iranian residents have reported experiencing difficulty while trying to access cryptocurrency exchanges such as Binance, peer-to-peer exchange LocalBitcoins, and Blockchain. This, despite the residents reportedly using a VPN service or other ways of bypassing the Iranian government’s censorship of the internet.

An experienced cryptocurrency user in Iran revealed that a lot of people in the rogue state are buying Bitcoin (BTC) in order to use it “as a hedge instrument.” The country’s bitcoin users claim that it’s easier to obtain the cryptocurrency compared to trying to buy US dollars through “the black market.” Due to rising inflation, with the current inflation rate reaching 127 percent, along with political instability, many Iranians are reportedly not too concerned with bitcoin’s volatility.

Preventing Cross-Border Payments

Ahmad Khalid Majidyar, the head of IranObserved Project at the Middle East Institute, stated that the Iranian government’s leaders do not want the country’s citizens to send money abroad, particularly US dollars. The Middle East Institute is an established Washington-based organization that serves as a think tank and provides non-partisan political analysis. Majidyar added that more government restrictions might soon follow and that they could also affect Iran’s crypto economy.

The Iranian government is currently struggling to deal with the nation’s economic turmoil, which experts attribute mainly to the crippling US-led sanctions. Authorities in Iran have also placed tight controls on cryptocurrencies in an effort to prevent the flight of capital from the isolated nation. This is presumably in response to stop many of Iran’s residents who might be using digital currencies for international money transfer.

Denying Banking Services To Crypto Dealers

In December 2017, the country’s authorities ordered all financial institutions to terminate banking relationships with individuals dealing in cryptos. Additionally, the Central Bank of Iran was instructed not to conduct any operations which would “promote” cryptocurrencies. In May, Mohammad Reza Pourebrahim, head of Iran’s economic committee, issued a statement warning local cryptocurrency traders that their activities could potentially hurt the nation’s already fragile economy.

According to recent reports, the censorship of the internet in Iran seems to be increasing with network traffic being monitored through a process known as “deep packet inspection.” This process was also previously used by the country’s government to prevent those using VPN services from gaining access to cryptocurrency exchanges.

At present, decentralized exchange LocalBitcoins cannot be accessed in Iran and the use of imported crypto mining hardware is prohibited. These restrictions appear to have been placed by the nation’s government because the crypto service providers say they have not taken any measures to prevent people in Iran from accessing their cryptocurrency platforms.

Despite these restrictions, crypto traders continue to trade with each other, mostly by meeting in person, according to anonymous sources. Officially though, buying and trading cryptocurrencies by using Iranian Rials is prohibited.

Cardano (ADA) on Fire: Surges Above $0.10 to Get Into Top 6, Up 206% in 2020

At 16:00 UTC on Friday (July 3), shortly after IOHK, the company developing the Cardano (ADA) protocol, announced a custody agreement with Coinbase, the price of the ADA token went over $0.10 for the first time since October 2018, thereby making ADA the sixth most valuable cryptoasset by market cap.

Yesterday, on day two of the two-day "Cardano Virtual Summit: Shelley Edition", IOHK Co-Founder and CEO Charles Hoskinson announced that from Q4 of this year, Cardano blockchain users would be able to store their ADA holdings at Coinbase Custody "without losing the ability to delegate their stake."

On Tuesday (June 30), IOHK announced that the Shelley codebase had been released to Cardano’s mainnet (but note that the actual hard fork is not expected until around July 29):

Hoskinson had this to say about his company's agreement with Coinbase Custody, which "operates as a standalone, independently-capitalized business to Coinbase, Inc.":

"With Cardano, we believe we can create a revolutionary solution which will be able to offer access to finance and investment to swathes of the population who have previously been shut out of the system.

"This custody agreement allows us to offer the same secure storage solutions that can be found in traditional finance to ada holders, without sacrificing what makes Proof of Stake blockchains special - being able to participate in the network.

"We look forward to this partnership with Coinbase, and to continuing to bring cryptocurrencies closer and closer to mainstream adoption."

As for Sam McIngvale, Head of Product at Coinbase Custody, he said:

"We have been following the success of the Cardano incentivized testnet, with over a thousand registered stakepools during the testing period.

"We are pleased to have been selected as the custodian and we’re proud to be a full-service, regulated, comprehensively-insured, and 100% offline staking provider in crypto.

"The ability to successfully operate within a regulatory framework is essential for the long-term survival of cryptocurrencies.

"We are overseen by the same regulators, and held to similar capital requirements and audit requirements as a traditional financial custodian, which removes many of the perceived barriers to global acceptance of crypto."

IOHK's announcement was made just before 14:00 UTC on Friday (July 3). By 16:00 UTC, the ADA price had broken through the $0.10 resistance level for the first time since October 2018.

Currently (as of 07:34 UTC on July 4), Cardano's token is trading at $0.1003 (up 6.94% in the past 24-hour period), which makes it the sixth most valuable cryptoasset by market cap:

24 Hour CC Chart for ADA-USD on 4 July 2020.png

So far in 2020, Cardano's ADA has gone up over 206% vs. the dollar.