The Central Bank of Iran introduced a total ban on virtual currencies use in the country, where the government is desperately trying to fight against tremendous inflation of the national rial.

In attempts to put all financial operations in the country under control, the Iranian Central Bank prohibited to all banking and financial institutions of Iran to use bitcoin and other cryptocurrencies. The corresponding resolution was published by the Central Bank of the Islamic Republic of Iran. According to the official statement, the reason for the ban is economic and terrorist threat associated with cryptocurrencies.

"Since various types of virtual currencies have the potential to become a tool for money laundering, terrorism financing and other criminal activities, the central bank's monitoring department currencies," the statement reads.

Currently, Iran's economy is in depression in anticipation of new sanctions from the US, which may come into effect in May. This month, the exchange rate of the Iranian currency, rial, has fallen against the dollar. In order to prevent further uncontrolled inflation, the government of the country seeks to tightly control all currency exchange operations, both within official financial institutions and on the black market, including cryptocurrency industry.

Earlier, in February, Mohammad Azari Jahromi, Iranian Minister of Information and Communication Technologies of Iran, stated that the Postal Bank of Iran was developing a state cryptocurrency similar to the Venezuelan Petro.