The chief executive of Iran’s Tejrat Bank has stated that the emergence of bitcoin and innovations like blockchain technology will have an impact on the way in which banks operate in the country. The executive has also called for laying the groundwork to embrace and welcome bitcoin and Fintech innovations in Iran.
Mohammad Ibrahim Moqaddam was speaking at an expert panel regarding digital currencies when making the remarks, according to a report by regional publication Banker.ir. The panel was attended by a number of senior bank executives and industry experts in the country.
Here, the banking executive opined that the ‘phenomena’ of bitcoin or other virtual currencies and virtual transactions over a blockchain with virtual transfer of value between individuals and currency exchanges will have a “considerable effect on the operating nature” of Iran’s banks.
Further, he addressed the concerns and resistance imposed by other countries against bitcoin. Contrary to the usual narrative, the chief executive said that innovation has always relied on technology and, as such, called such concerns as a thing of the past. Instead, Moqaddam pointed at the benefits of using the cryptocurrency and blockchain technology.
Calling for banks to work together with payment firms and Fintech startups with an edge in bitcoin and blockchain innovation, the banker sees such collaboration to enhance the business climate and operational efficiency of the Iranian industry.
A handful of related topics were also discussed, such as the risk management in bitcoin transactions, blockchain technology’s impact on digital transactions’ transparency and the speed of information exchange among banks, in a blockchain-based scenario. The possibility of increasing use of bitcoin in foreign exchange was also discussed, so too was welcoming and developing Fintech in Iran.
The use of bitcoin as forex instrument has been explored by banks in the past. A notable example is that of Shinhan Bank, a major South Korean financial institution that began a remittance service in the Korea – China corridor, with bitcoin. Faster, near-instant settlements at significantly lower costs are some of the straightforward benefits of using bitcoin in remittance.
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