A single cryptocurrency for Muslim states, says Iran

Rouhani proposes the cryptocurrency as a common denomination for Muslim countries and to be used for trading


IRAN surprised participants of the Kuala Lumpur (KL) Summit 2019 yesterday by proposing the creation of a single Islamic countries cryptocurrency, a move which would slice the dominance of the heavily-used US dollar.

Iranian President Dr Hassan Rouhani proposed the cryptocurrency as a common denomination for Muslim countries and to be used for the trading of goods and services.

Rouhani alluded to Prime Minister (PM) Tun Dr Mahathir Mohamad’s previous proposal to use gold or dinar as an alternative currency.

“With the existence of blockchain technology, we can introduce a common cryptocurrency with the cooperation of the central banks.

Recently, Dr Mahathir reiterated his intent of using the dinar.

“Perhaps with this new technology, we can create a new currency and promote this new technology in the Muslim world,” he said at the summit’s first roundtable session yesterday.

Rouhani said the creation of the cryptocurrency could help maintain the sovereignty of Muslim states and cap their dependence of the dollar.

Dr Mahathir said he welcomed Iran’s proposal, saying that countries should not be overly dependent on a single currency.

“We have made this suggestion a long time ago. We cannot always use the US dollar as it makes us too reliant on the US, who at any time, can impose sanctions against us and this will affect our economic growth.

“This is the first time we are hearing this from Iran and also Turkey. If we are in agreement, we don’t have to rely too much on the US dollar and we can use our own currency.

“We have mooted this idea a long time ago, but big superpowers made it impossible for this idea to be realised,” he said.

The world’s oldest leader last proposed the idea of using gold as a pan-Asian currency at the International Conference on the Future of Asia in Tokyo in June.

Dr Mahathir had initially proposed a currency based on gold following the 1997 East Asia Financial crisis, which almost bankrupted many countries in the region including Malaysia.

During the crisis, Dr Mahathir claimed speculators had pushed for the collapse of many Asian currencies.

The 94-year-old leader had also proposed the use of gold dinar again among Islamic countries.

The gold dinar has a long history in Muslim civilisation as it was the basic currency of the Islamic caliphates from the seventh through the 13th centuries.

Dr Mahathir said Malaysia can also benefit from Iran in other areas of science and technology.

“Prior to this meeting, we knew very little about Iran, but we realised that they are way ahead when it comes to science and engineering.

“We can work with them on this. They have advanced knowledge in these areas, so we can learn from them,” Dr Mahathir said.

Rouhani said Iran already has the ability to produce their own products, particularly in the oil and gas (O&G) sector.

“We (Iran) are now able to stand on our own feet. Due to the sanctions imposed on us, we needed to be self-sufficient. As such, we started to manufacture our own turbines and are now totally self-sufficient to manufacture turbines,” he said.

Iran has been gripped by US sanctions after President Donald Trump pulled out from a nuclear accord Iran signed with world superpowers in 2015.

Washington has been exerting continuous pressures to paralyse the Muslim nation with about 82 million people by slapping bans and trade restrictions. Recently, the US Treasury imposed new sanctions on Iran’s biggest airline, Mahan Air, and the country’s shipping industry, intending to force Tehran to yield to its demands.

Besides the cryptocurrency, Iran forwarded a proposal to create insurance on transportation among the Muslim nations and in the halal sector.

In tourism, Rouhani said Muslim countries can work together to promote their culture and heritage, while also capitalising on health tourism.

Meanwhi le, Dr Mahathir, Rouhani and Turkish President Recep Tayyip Erdogan witnessed the exchange of eight memoranda between the three countries.

The partnership included deals in food security, defence, media, O&G, youth leadership and the creation of a centre of excellence.