The Informatics and Services Corporation (ISC) of the Central Bank of Iran (CBI) is developing a national Blockchain platform on the IBM Hyperledger Fabric. Areatak, a Tehran-based Blockchain solutions provider is working with the CBI on the deal that is focusing on delivering a platform for the financial and banking sectors of the country.
The Blockchain-based platform is codenamed Borna and Iran intends to use it to reinvigorate its sanctions-targeted banking system. This project is deemed to fulfill the country’s aspirations of creating a strong digital economy as an alternative to the current legacy system.
Borna Will Allow CBI To Monitor Financial Institutions Closely
When launched, Borna will allow all CBI-managed institutions to adopt Decentralized Ledger Technology (DLT) by easing the barriers of entry that companies grapple with when adopting DLT in regards to technical expertise and cost.
Consequentially, the platform will facilitate the adoption of Blockchain and increase its footprint in the mainstream Iranian economic landscape.
A Centralized Blockchain?
Borna’s protocols are being developed by the ISC and Areatak according to reports from Al-monitor-a local news outlet.
The report says that Borna will be designed as a central digital platform for Iran’s banking and financial sectors meaning that the Blockchain ecosystem will be a permissioned/private network.
Further down the roadmap, the system is set to be public to onboard Iranian-based SME’s that are vital to the Iranian economy.
The Project Concept Is Newly Released
The whitepaper for the project was unveiled in January 2019 where the CBI team explains the significance of the platform as well as its architecture layers such as the non-competitive and competitive layers.
To get a sneak peek into one of the layers, the noncompetitive application will be focusing on three core functions including Token management systems, Know Your Customer (KYC) protocols, and digital auditing. Therefore, Borna will give the CBI capacity to monitor the futuristic Digital technology-based Iran.
The System Will Support Super-Fast Transactions
In the partnership arrangement, the ISC owns the Blockchain and Areatak is the private contractor building the platform on the Hyperledger Fabric.
The contractor will be building several protocols that will be tested on the IBM open-source DLT sandbox that will test the viability of the project.
The most notable feature of Hyperledger is its plug-and-play smart contract protocol that was recently upgraded to increase its ability to offer faster transactions. Hence, Borna will be able to provide faster transactions than the standard financial and banking industry conventional technologies.
Is Borna Designed To Circumvent US Sanctions?
The US President Donald Trump and his secretary of state Mike Pompeo have vowed to pressurize Iran by making sure that the country does not export a “drop of oil”. This is meant to cut off Iran’s source of revenue to cripple government operations. Additionally, the US has also vowed to cut off Iran from the international finance and trade system.
Hence, there are rumors that suggest that Borna is Tehran’s strategy of circumventing these sanctions. However, President Hassan Rouhani’s proxy’s in the CBI have termed the rumors unfounded saying that the project’s network is only meant for Iranian-based use.