Iran’s capital market is preparing for a major shift as new regulations finalize the long-awaited framework for crypto-based investment funds.
With the Central Bank’s supervisory rules now in place and Tehran Stock Exchange (TSE) completing its operational model, officials say the market is ready to host regulated crypto products for the first time.
The move comes as global financial markets continue integrating digital assets. Since Bitcoin’s emergence in 2008, cryptocurrencies have grown into a multi-trillion-dollar asset class, with more than 18,000 tokens traded on over 1,400 exchanges. While crypto’s market value—around $3 trillion—still represents only a small share of global equities, its growth has far outpaced traditional markets, drawing the attention of regulators and stock exchanges worldwide.
Many exchanges initially experimented with direct tokenization of assets, but these efforts largely stalled due to low liquidity and regulatory challenges.
Over time, crypto-backed exchange-traded funds proved far more successful. Canada launched the world’s first Bitcoin ETF in 2021, attracting over $1 billion in its first month. The United States approved 11 spot Bitcoin ETFs in January 2024, followed by launches in Europe, Hong Kong, Kazakhstan, Australia and Brazil. Today, more than 20 countries offer crypto-based ETFs across 26 exchanges.
Racing to Catch Up
Against this backdrop, TSE officials say Iran must not fall behind. At a recent conference on digital assets, Mahmoud Goudarzi, CEO of the Tehran Stock Exchange, emphasized that the exchange supports the responsible introduction of crypto-based instruments to meet evolving investor demand while safeguarding transparency and risk management.
He noted that global exchanges share similar concerns about risk and volatility, underscoring the need for strong regulatory oversight.
Iran’s regulatory foundations have taken shape rapidly. The Capital Gains Tax Law, approved for 2025, explicitly recognizes cryptocurrencies as taxable assets for the first time—removing longstanding legal doubts. In parallel, the Central Bank issued a comprehensive regulatory framework in December 2024 that defines “crypto-assets,” “crypto-money,” and “tokenized securities,” and introduces new licensed entities such as “crypto-brokers” and “custodians.” Subsequent guidelines allow these brokers to offer trading, advisory and portfolio services.
Building on these reforms, TSE has finalized a model for crypto investment funds. Under the proposed structure, investors holding Bitcoin or other approved cryptocurrencies would be able to sell their assets directly to an authorized fund through licensed crypto-brokers. Purchased assets would then be transferred to a Central Bank-approved custodian, ensuring secure storage. Fund units would trade on the TSE like any other ETF, with professional market-makers maintaining price alignment with net asset value.
If implemented, this would represent the first legal and transparent bridge between Iran’s informal crypto economy—estimated in the billions—and its formal capital market.
Analysts say such funds could channel idle digital wealth into productive investment while offering investors a regulated alternative to offshore exchanges.
For a market long constrained by limited hedging tools and high dollar volatility, crypto-based funds may provide both innovation and diversification. Their success, however, will depend on strict oversight and the ability of market institutions to balance innovation with stability.