The President of Iran’s Blockchain Association, Sepehr Mohammadi, says over BTC 500, currently worth USD 3.9 million as of 23 July 2018, have been seized from Iranian citizens by the United States in the past year. He claims that Bitcoin confiscations are still happening and Iranians are in a particularly sticky situation since they have practically no legal recourse, due to Bitcoin being illegal in Iran.
Mohammadi says, “Last year, a remarkable volume of Bitcoins which belonged to some Iranians were confiscated for unspecific reasons by the federal government of the United States, and the process of confiscation is still continuing. The owners of confiscated Bitcoins are unable to take legal action against the US inside Iran as cryptocurrencies are banned in the country. The association is looking to take international legal action, but they have not yet found a legal expert in anti-money laundering law who will handle the case”.
The Central Bank of Iran banned banks and financial institutions from facilitating Bitcoin and cryptocurrency transactions in April 2018, saying, “All cryptocurrencies have the capacity to be turned into a means for money laundering and financing terrorism and in general can be turned into a means for transferring criminals’ money.”
This comes at a time when Iranian citizens are converting their assets into cryptocurrency and Bitcoin to safeguard themselves from accelerating hyperinflation of the Iranian rial (IRR), following the announcement that the Iran nuclear deal had been dissolved, and that US sanctions would resume. Indeed, the Chairman of the Economic Committee of Iran’s Parliament estimates that USD 2.5 billion has been sent out of Iran to buy cryptocurrency, among a total of USD 30 billion sent out of Iran during the first few months of 2018.
Simultaneously and ironically, Iran is considering using Bitcoin to circumvent international sanctions, since soon the Iranian government will be cut off from using normal international financial services.
The best way for Iranians to avoid crypto seizures is to hold Bitcoin in their own wallets where they control the private key instead of on an exchange or online wallet service. However, this is can be risky due to the illegal status of Bitcoin in Iran.
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