Iran Compliance Report

Generated 2026-09-22

Comprehensive Framework

Regulatory Overview

Regulatory Status: Dedicated crypto/VA legislation, licensing regime, active enforcement
Key Regulator(s): Bureau of Industry and Security, Central Bank of Iran, Export Administration, Ministry of Economy and Financial Affairs, Ministry of Industry, Economic Council
Primary Legislation: The primary law is the Iranian Transactions and Sanctions Regulations (ITSR), co, The regulations are exclusively focused on sanctions, export controls, and licen, No Iranian tax authority, tax code, or tax regulation is referenced in any of th
Travel Rule: Adopted — Threshold: Implemented
Tax Reporting: Banned for Domestic Payments: The Central Bank of Iran (CBI) has repeatedly banned the use of cryptocurrencies for domestic payments and transactions within Iran.. Restrictions on Domestic Exchanges/Trading: While some local exchanges operate, individual trading and holding of cryptocurrencies are generally discouraged, tightly regulated, or even de facto illegal for retail investors for speculative purposes by the CBI. There is no clear legal framework for individuals to legally trade cryptocurrencies on a large scale.. Legal for Imports (Under Specific Conditions): In 2022, Iran officially approved the use of cryptocurrencies for import payments as a way to circumvent international sanctions. This is typically for businesses and under strict governmental oversight.. Regulated Mining: Crypto mining is recognized as a legal industrial activity in Iran but requires licenses from the Ministry of Industry, Mine and Trade and is subject to specific regulations, including higher electricity tariffs.. Status: Legal, regulated industrial activity requiring licenses.

Key Facts

aml FATF Blacklisting: Iran is currently on the FATF's "Public Statement – High-Risk Jurisdictions Subject to a Call for Action," meaning it is subject to a call for countries to apply enhanced due diligence and, in the most serious cases, countermeasures to protect the international financial system from the ongoing money laundering, terrorist financing, and proliferation financing (ML/TF/PF) risks emanating from Iran. This significantly impacts any international VASP's ability or willingness to operate in or with Iran. International Sanctions: Iran is under extensive international sanctions (primarily from the US), which prohibit most financial transactions involving Iranian entities or individuals, further complicating VASP operations. Evolving Domestic Stance: Iran's stance on cryptocurrencies has evolved from outright bans to allowing regulated mining and exploring the use of crypto for bypassing sanctions (e.g., import payments), while generally maintaining strict controls over public trading and use for domestic payments. Purpose: This is the foundational AML law in Iran, establishing general obligations for reporting entities (which would include any authorized financial service providers, including VASPs if fully integrated into the financial system). Key Provisions: Defines money laundering offenses, sets reporting obligations, establishes the Supreme Council for Combating Money Laundering and Financing of Terrorism, and outlines the role of the Financial Intelligence Unit (FIU). Legislation Name: "Law on Combating Money Laundering" (Qanun Mobaraze ba Pulshui), initially passed in 2008 and amended in 2019. Purpose: Addresses the financing of terrorism. Any VASP, if operating, would be subject to its provisions, especially regarding sanctions screening and suspicious transaction reporting. The CBI is the primary regulator for financial services and has issued directives concerning virtual assets.
enforcement Tavanir (Iran Electricity Generation, Transmission and Distribution Company): The primary entity responsible for identifying and disconnecting illegal mining operations. Law Enforcement Force (LEF): Conducts raids and arrests. Iran's judiciary is used as a political tool to prosecute and repress peaceful protesters, political opponents, and individuals deemed security threats, often under post-war security laws, as documented by EU sanctions and human rights monitors. Ministry of Energy: Sets policies and oversees Tavanir. Entities Targeted: Unlicensed cryptocurrency mining farms, both large-scale industrial operations and smaller home-based setups. Illicit cryptocurrency mining without a license. Electricity theft or misuse of subsidized electricity. Operating energy-intensive equipment without authorization.
licensing Iran has not established a specific licensing framework for cryptocurrency and digital asset businesses as of 2025–2026; instead, digital asset activities are governed indirectly through general sanctions, trade, and financial regulations administered by the Office of Foreign Assets Control (OFAC) and the Bureau of Industry and Security (BIS) Federal Register :: Publication of Iran-Related Web General Licenses U and V The primary regulatory bodies are the U.S. Department of the Treasury's OFAC, which administers the Iranian Transactions and Sanctions Regulations (ITSR) at 31 CFR Part 560, and the Department of Commerce's BIS, which administers export controls under Section 746.7 of the Export Administration Regulations (EAR) Federal Register :: Iranian Transactions and Sanctions Regulations No entity has been granted a license to operate a cryptocurrency exchange or digital asset business in Iran under the U.S. regulatory framework; OFAC issues only temporary, transaction-specific general licenses (such as GL U, GL V, and GL X) for crude oil, petroleum products, and petrochemicals — not for digital assets Issuance of Iran-related General License | Office of Foreign Assets Control There is no Iranian domestic licensing authority for digital assets identified; the applicable legal framework is extraterritorial U.S. sanctions law, meaning a "license" from relevant U.S. agencies is required for lawful engagement Federal Register :: Iranian Transactions and Sanctions Regulations The Office of Foreign Assets Control (OFAC) is the principal regulator for transactions involving Iran, operating under the Department of the Treasury and publishing licenses and regulations on its website at https://ofac.treasury.gov Federal Register :: Publication of Iran-Related Web General Licenses U and V The Bureau of Industry and Security (BIS) of the Department of Commerce regulates exports to Iran under Section 746.7 of the Export Administration Regulations (EAR), requiring licenses for most items on the Commerce Control List (CCL) Iran export controls | Bureau of Industry and Security The primary law is the Iranian Transactions and Sanctions Regulations (ITSR), codified at 31 CFR Part 560, which was reissued in its entirety on October 22, 2012 (77 FR 64664) and has been amended several times since, including a final rule effective May 17, 2024 (89 FR 43311) Federal Register :: Iranian Transactions and Sanctions Regulations Additional relevant regulations include the Iranian Financial Sanctions Regulations (31 CFR Part 561), Iranian Sector and Human Rights Abuses Sanctions Regulations (31 CFR Part 562), Weapons of Mass Destruction Proliferators Sanctions Regulations (31 CFR Part 544), Russian Harmful Foreign Activities Sanctions Regulations (31 CFR Part 587), Ukraine-/Russia-Related Sanctions Regulations (31 CFR Part 589), and Global Terrorism Sanctions Regulations (31 CFR Part 594) Federal Register :: Publication of Iran-Related Web General Licenses U and V
sanctions Controlling the flow of capital and preventing money laundering/terrorist financing. Utilizing cryptocurrencies (specifically mined ones) for import payments to circumvent sanctions. Prohibiting or heavily restricting the domestic use and trading of cryptocurrencies by individuals and unlicensed entities. No explicit license requirements for third-party digital asset custody services exist. This is primarily because such services are generally not permitted or recognized within a regulated framework for individual or institutional clients. The Central Bank of Iran (CBI) has historically taken a prohibitive stance on cryptocurrency activities that could lead to capital flight or undermine the national currency. While mining has been licensed for specific purposes (see "Pending Legislation" below), this doesn't extend to general custody services. Financial institutions (banks, credit institutions) in Iran are generally prohibited from dealing in cryptocurrencies, which would include offering custody services. Non-existent. As there are no recognized licensed custodians, there are no rules mandating the segregation of client assets from proprietary assets. Non-existent. Without a regulatory framework for custody services, there are no requirements for insurance or bonding.
securities Iran has not established a specific legal framework for cryptocurrency or digital asset securities as of 2025–2026, and no Iranian regulatory authority has issued a licensing regime for crypto securities Iran Sanctions FAQ - Office of Foreign Assets Control The only applicable rules for Iran-based digital asset activity are U.S. sanctions regulations administered by the Office of Foreign Assets Control (OFAC) at the Department of the Treasury, which restrict U.S. persons and impose blocking requirements on Iranian financial institutions Federal Register :: Iranian Transactions and Sanctions Regulations No Iranian government agency has been named as a securities regulator for digital assets, and no licensing pathway exists for crypto exchanges, custodians, or digital asset securities issuers within Iran Federal Register :: Iranian Transactions Regulations In practice, no entity has secured any form of official authorization for digital asset securities activity in Iran, and the practical reality is that crypto securities businesses cannot operate legally or with regulatory certainty 31 CFR § 560.517 - Exportation of services: Iranian accounts at United States depository institutions or United States registered brokers or dealers in securities. | Electronic Code of Federal Regulations (e-CFR) | US Law | LII / Legal Information Institute The primary legal constraint governing crypto-related activity is the Iranian Transactions and Sanctions Regulations (ITSR), 31 CFR Part 560, which imposes comprehensive trade and financial sanctions on Iran and prohibits most transactions involving Iranian accounts and securities services Iran Sanctions FAQ - Office of Foreign Assets Control The Office of Foreign Assets Control (OFAC), part of the U.S. Department of the Treasury, is the primary authority that regulates transactions involving Iran, including any digital asset securities activity with Iranian nexus; OFAC's website is https://ofac.treasury.gov Federal Register :: Iranian Transactions and Sanctions Regulations The Iranian Transactions and Sanctions Regulations (ITSR) are codified at 31 CFR Part 560 and were reissued in their entirety on October 22, 2012, effective the same date Federal Register :: Iranian Transactions Regulations The ITSR implement Executive Order 13599 of February 5, 2012, which blocks property of the Government of Iran and Iranian financial institutions, and subsections 1245(c) and (d)(1)(B) of the National Defense Authorization Act for Fiscal Year 2012 (NDAA) Federal Register :: Iranian Transactions Regulations
status Cryptocurrency and digital asset activities in Iran operate within a complex and evolving legal environment where the government has issued religious decrees (fatwas) permitting certain crypto mining activities while maintaining significant restrictions on trading and usage. Permanent Mission of the Islamic Republic of Iran to the United Nations Office and other International Organizations in Geneva- The Islamic Republic of Iran Charter on Citizens' Rights December 2016 The Central Bank of Iran (CBI), operating under the Ministry of Economic Affairs and Finance, serves as the primary regulatory authority for financial and monetary matters, including digital assets, though its specific crypto mandate derives from broader banking regulations. Government Electronic Services Information Getway No comprehensive dedicated cryptocurrency licensing regime has been established for exchanges or trading platforms; however, mining operations require authorization from the Ministry of Industry, Mine and Trade under the Commercial Code of Iran. Ministry of Industry, Mine and Trade:: The Commercial Code of Iran As of 2025–2026, no exchange or trading platform has been formally licensed under a dedicated digital asset framework, and the practical reality is that most crypto-related businesses operate in a regulatory grey zone, subject to periodic crackdowns and changing administrative guidance. Rules and Laws The legal framework is primarily derived from the Iranian Constitution, the Commercial Code of Iran, and the Charter on Citizens' Rights, which collectively establish the foundational legal principles but lack specific digital asset provisions. THE CONSTITUTION Central Bank of Iran (CBI) – primary monetary and banking authority responsible for payment systems and financial stability, with implied jurisdiction over digital currency matters. Government Electronic Services Information Getway Ministry of Foreign Affairs (MFA) – handles international legal aspects and sanctions compliance matters. Ministry of Foreign Affairs of the Islamic Republic of Iran- Oral Statement of theIslamic Republic of Iran The Judiciary – responsible for enforcement actions and interpretation of laws as they apply to digital assets. Permanent Mission of the Islamic Republic of Iran to the United Nations Office and other International Organizations in Geneva- The Islamic Republic of Iran Charter on Citizens' Rights December 2016
tax Banned for Domestic Payments: The Central Bank of Iran (CBI) has repeatedly banned the use of cryptocurrencies for domestic payments and transactions within Iran. Restrictions on Domestic Exchanges/Trading: While some local exchanges operate, individual trading and holding of cryptocurrencies are generally discouraged, tightly regulated, or even de facto illegal for retail investors for speculative purposes by the CBI. There is no clear legal framework for individuals to legally trade cryptocurrencies on a large scale. Legal for Imports (Under Specific Conditions): In 2022, Iran officially approved the use of cryptocurrencies for import payments as a way to circumvent international sanctions. This is typically for businesses and under strict governmental oversight. Regulated Mining: Crypto mining is recognized as a legal industrial activity in Iran but requires licenses from the Ministry of Industry, Mine and Trade and is subject to specific regulations, including higher electricity tariffs. Status: Legal, regulated industrial activity requiring licenses. Income Tax: Licensed crypto mining operations are treated as businesses and are subject to standard corporate income tax rates. The income generated from mining (e.g., block rewards converted to fiat, or the sale of mined crypto) is considered business income. Corporate Income Tax Rates: These vary based on factors like company type, profit levels, and whether they are listed on the stock exchange. Generally, the standard corporate income tax rate for Iranian companies is 25% of taxable income. If the mining operation is considered to be providing a service (e.g., validating transactions) or selling its "product" (mined crypto) within Iran, it could potentially be subject to VAT.
travel rule Iran is subject to FATF High-Risk Jurisdiction status with countermeasures called for, meaning the country does not have a compliant AML/CFT framework and international entities must apply enhanced scrutiny to Iranian counterparties, including virtual asset service providers (VASPs) Financial Action Task Force Identifies Jurisdictions with Anti-Money Laundering, Combating the Financing of Terrorism, and Counter-Proliferation Finance Deficiencies | FinCEN.gov Iran's domestic legal framework for cryptocurrency regulation is not recognized by FATF as compliant, and the country lacks the comprehensive AML/CFT legislation necessary to implement travel-rule standards Financial Action Task Force (FATF) Calls for Countermeasures on Iran, Evaluates U.S. AML Framework, Releases Digital Identity Guidance | U.S. Department of the Treasury No Iranian licensing regime for VASPs has been established that meets international standards; the FATF has explicitly identified Iran as requiring countermeasures, including prohibiting financial institutions and VASPs from establishing new correspondent relationships with Iranian entities Financial Action Task Force Identifies Jurisdictions with Anti-Money Laundering, Combating the Financing of Terrorism, and Counter-Proliferation Finance Deficiencies | FinCEN.gov Iranian financial institutions and VASPs face international sanctions and countermeasures, and the FATF has called for effective countermeasures since 2020, reaffirmed in February 2025 and again in February 2026 Financial Action Task Force (FATF) Calls for Countermeasures on Iran, Evaluates U.S. AML Framework, Releases Digital Identity Guidance | U.S. Department of the Treasury The travel-rule framework, as defined by FATF Recommendation 16, requires VASPs to share originator and beneficiary information for virtual asset transfers; Iran has not implemented this requirement, and its inability to comply has contributed to its continued high-risk designation Financial Action Task Force Identifies Jurisdictions with Anti-Money Laundering, Combating the Financing of Terrorism, and Counter-Proliferation Finance Deficiencies | FinCEN.gov The Financial Action Task Force (FATF) is the international standard-setting body for AML/CFT/CPF; on October 11, 2007, FATF identified Iran as the only country with significant AML/CFT vulnerabilities requiring enhanced due diligence Guidance to Financial Institutions on the Increasing Money Laundering Threat Involving Illicit Iranian Activity | FinCEN.gov FATF continues to list Iran on its "High-Risk Jurisdictions Subject to a Call for Action" list, noting that Iran has significant strategic deficiencies in its AML/CFT/CPF regimes Financial Action Task Force Identifies Jurisdictions with Anti-Money Laundering, Combating the Financing of Terrorism, and Counter-Proliferation Finance Deficiencies | FinCEN.gov The FATF countermeasures are designed to protect the international financial system from ongoing money laundering, terrorist financing, and proliferation financing (ML/TF/PF) risks emanating from Iran Financial Action Task Force (FATF) Calls for Countermeasures on Iran, Evaluates U.S. AML Framework, Releases Digital Identity Guidance | U.S. Department of the Treasury

Sources

This report is AI-generated from publicly available regulatory sources. Last updated: 2026-09-21. View full profile