As part of its plan to develop a new version of its national currency, the Central Bank of Iran will reportedly start testing a central bank digital currency ("CBDC") on Thursday.The central bank's goal of designing the digital rial is to "turn banknotes into a programmable entity," according to a release from the newsroom associated with the country's Chamber of Commerce, Industries, Mines and Agriculture.The digital rial is not designed to compete with cryptocurrencies such as bitcoin (BTC-USD) because CBDCs are centralized, whereas cryptos are decentralized, the report said. Note a CBDC represents a digital form of a fiat currency, such as the U.S. dollar, issued by a central bank like the Federal Reserve.The CBI's move comes on the heels of Hong Kong's plans to start trailing its CBDC in the fourth quarter.In 2021, Iran shut down crypto mining to save power to avoid winter blackouts.
