The Feasibility of Addressing the Financing of Terrorist Crimes in the Realm of Cryptocurrencies: The Experiences of Iran and Other Countries

Document Type : Original Article

Author

Associate Professor of Criminal Law and Criminology, Faculty of Administrative Sciences and Economics, Arak University, Arak, Iran

Abstract

Cryptocurrencies, despite their ambiguous nature, represent one of the most significant new phenomena in the global economy. Since the introduction of the first cryptocurrency, Bitcoin, in 2009, terrorist groups have increasingly utilized these currencies to finance their activities. Consequently, states, organizations, and financial institutions have been compelled to adopt effective anti-terrorist financing strategies in response to this development. This research examines a range of issues related to cryptocurrencies, their utilization in terrorist financing, and the associated benefits and risks. Within the context of Iran's regulatory framework, existing policies and measures to combat the financing of terrorist crimes through cryptocurrencies have led to challenges characterized by conflicting and fragmented approaches to the regulation of cryptocurrency exchanges and mining, both theoretically and practically, which include the illegitimacy of exchange activities. Internally, the Central Bank has issued directives aimed at clarifying this phenomenon and has sought demands from higher authorities, particularly the Islamic Council. In contrast, other countries, such as China, have adopted a dual policy, prohibiting the use of cryptocurrencies in monetary and banking contexts. Notably, nations like Canada and the United States have established specific legal regulations and policies governing Bitcoin usage, while Japan has developed regulations for virtual currency exchange service providers, including mechanisms for identifying violators through guaranteed criminal enforcement.

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References

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Iranian Journal of International and Comparative Law
Volume 2, Issue 1
June 2024
Pages 55-67

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