اخبار ایران

What does cyberspace protection plan mean for digital currency investors in Iran?


For some time now, a plan entitled “Supporting the rights of users and basic services of cyberspace” has been proposed by some members of the Islamic Consultative Assembly and has raised concerns for various segments of society. Regarding digital currencies, an important question that has occupied the minds of Iranian traders is the relationship between this plan and the activities of foreign exchange offices and digital currency wallets; An issue that is directly related to the capital of Iranian traders. In fact, the main question is: what will happen to the assets stored in foreign exchange offices or wallets with the implementation of the protection plan?

Dedicated to digital currency – Last week, the controversial plan “Protection of users’ rights and basic services of cyberspace” or the same protection plan that is a modified version of the old plan “Organizing social media”, with the consent of 121 members of parliament, according to Article 85 of the Constitution. It was assigned to a joint commission for review. The bill, which has been strongly opposed by some lawmakers and other officials, including Minister of Communications Azari Jahromi, is set to be considered by a joint specialized commission without being referred to the parliament after approval by the Guardian Council. Run on a trial basis for 3 to 5 years.

Now, the issue that concerns Iranian cyberspace users, including digital currency traders, is the blocking or restriction of some foreign platforms following the implementation of the protection plan. The fundamental changes of the new plan, the generalities and different comments of the members of parliament have also caused the users not to have a clear picture of this plan, materials and how to implement it.

To answer this question, we must first consider some of the details of the cyberspace users’ protection plan.

What is a conservation plan?

What does cyberspace protection plan mean for digital currency investors in Iran?

According to the draft submitted by the members of parliament, the legal plan to protect the rights of users and the basic services of cyberspace application called the protection plan has been presented with the aim of protecting the rights of users in cyberspace. According to the protection plan, a set of rules for the activities of messengers, social networks, search engines, data hosting services, and internal and external is to be considered so that, according to what is written, “users’ rights are not compromised by the current legal vacuum.” . »

So far, everything seems to be in the best interest of cyberspace users, but the plan raises an issue that has provoked opposition from officials, other members of parliament and cyberspace users.

Article 12 of the draft protection plan states that high-usage foreign and domestic platforms, in order to continue their activities in Iran, after the implementation of this plan will be required to comply with certain laws and need to receive the approval of the commission, otherwise the Ministry of Communications can Penalty platforms or restrict or block access to them.

Article 12 of this plan states:

The supply and operation of basic services in cyberspace is subject to compliance with the laws of the country and the following conditions:

1. Registration in the portal of basic application services.

۲. Obtaining a license to operate effective services based on domestic and foreign applications.

According to the draft text of this plan, basic application services are services that have become an unavoidable part of cyberspace and the national information network and have a strategic aspect or a large number of internal audiences. The Center for Parliamentary Research has also stated that the main examples of basic services used in social networks are search engines, basic location and map services, data hosting services, and so on.

There is no clear answer as to whether foreign platforms are willing to comply with the conditions mentioned in this plan due to sanctions and domestic laws of Iran, and this issue has caused some users to implement this plan by gradually blocking the activities of foreign platforms. Consider, of course, that this hypothesis has been rejected by the Parliamentary Research Center.

Asked if the plan would filter WhatsApp, Instagram, Google and other popular online sites used by businesses, the House Research Center said:

No, none of them are filtered, because there is no alternative. We also need to use these services for international marketing and globalization of Iranian luxury content.

Are exchanges and digital currency wallets blocked?

What does cyberspace protection plan mean for digital currency investors in Iran?

As can be seen from the draft protection plan, it targets most of the search engines, messengers, and other key Internet services, and does not specifically mention exchanges, online wallets, and other digital currency platforms. For example, it is not clear whether Bainance Exchange is a widely used domestic service. Also, while wallets such as the Walt Trust do not have a suitable internal alternative, it is not clear whether this wallet will be considered a popular service or not.

Part of the old plan to organize social media explicitly stated that anyone who buys or sells digital currency on social media without the permission of the central bank would be found guilty and punished. It is worth noting that this item has been completely removed from the new design and does not include the name of digital currencies.

However, the new plan addresses the issue of payment services and says that unlicensed platforms are not allowed to provide payment services.

Article 18 of this plan states:

It is forbidden to provide any payment services in the basic services without a license. Provision of payment services in licensed foreign application services is subject to the approval of the Commission. The Central Bank is responsible for overseeing the proper implementation of this article.

According to this article, in case of implementation of this law, if domestic and foreign exchange offices or even online wallets are identified as payment service providers in the category of basic services, they are obliged to obtain approval in addition to receiving permits related to the User Rights Protection Law. Receive a commission for providing payment services, otherwise their activities may be restricted or blocked.

Also read: Legal pressures on Bainance; Danger lurking in Iranian traders?

As mentioned earlier, the House Research Center cites only messengers, social networks, search engines, and data hosting service providers as examples of basic utility services, and the commission appears to focus more on messengers and social networks.

Therefore, it seems a bit unlikely that exchange offices and digital currency wallets will also fall into the category of basic services. But if the law goes into effect in the future, and exchanges and digital currency wallets are also identified as basic utility services, it remains to be seen whether these platforms will be licensed by the commission.

What if foreign wallets and exchanges were blocked after the protection plan?

In the most pessimistic case, if the plan is implemented, exchange offices and digital currency wallets would fall into the category of basic utility services and could not receive commission approval. These platforms maintain and move it to another location.

According to experts, if the capital of traders is in personal wallets such as Trust Walt and users have backups of their wallets, by blocking the wallet by Iran, the users’ capital is not endangered and the assets can be accessed again. On the other hand, experts believe that the risk is higher for investments in foreign exchange offices; But it is likely that Iranian traders will have the opportunity to withdraw capital if a decision is made to block a specific foreign exchange.

As the user rights protection plan is still under consideration, it remains to be seen how the law will eventually be implemented and specifically what platforms it will cover.

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