Afghanistan Police Shuts Down Crypto Exchanges
- Crypto usage in Afghanistan has surged since the Taliban rose to power.
- Afghan locals leverage cryptocurrencies to preserve their wealth amidst the country’s poor economy.
The Taliban in Afghanistan has remained hostile to crypto activities, and the government is not likely to change its policies anytime soon. According to local sources, police authorities in the Herat province of western Afghanistan have shut down 16 crypto exchanges over the last few days. Some arrests were allegedly made during these closures.
According to the source, the shutdown was enforced in line with a three-month-old ban on cryptocurrency trading. In June, the central bank Da Afghanistan Bank, banned online foreign exchange trading. The central bank claimed it had not issued licenses to any exchanges making their operations illegal. A spokesperson for the bank claimed no Islamic law supports online forex trading, hence the decision to ban such activities.
According to Mohammad Suhrabi, head of Herat Money Exchangers’ Union Ghulam, Afghan locals are unfamiliar with digital currency accounts, and the country intends to keep it that way. Afghan authorities are reportedly willing to take extreme measures to enforce their policies, including prosecuting locals who violated the ban.
The Taliban’s rise to power in 2021 led to a surge in crypto usage in the country. Several locals clung to cryptocurrency in a bid to secure their wealth amidst the nation’s economic struggles. According to reports, Afghan natives were not interested in purchasing bitcoin. Instead, they wanted stablecoins pegged to the US dollar.
In an interview with Fortune Magazine, an Afghan crypto user stated that before the Taliban’s takeover, locals stored their wealth in the ground during times of crisis. But the Taliban’s inevitable arrival led citizens to embrace cryptocurrencies like Tether.
The surge in crypto adoption in Afghanistan is another example of the utility of cryptocurrencies in war-thorn nations. The Russia-Ukraine war is the most recent example of this. Since Russia invaded it in late February, more than $60 million has been donated in cryptocurrencies to Ukraine. Additionally, Myanmar’s exiled government has recognized Tether as a legitimate payment method as it plans to raise funds for a campaign to overthrow the military government that seized power last year.
Despite their interest in cryptocurrencies, Afghan natives have several hurdles facing their adoption. The country has poor internet access and an unstable power supply. The Taliban government has been accused of doing little to improve the standard of living in the nation or allow its citizens to source external aid.
Lawrence has covered some exciting stories in his career as a journalist, he finds blockchain-related stories very intriguing. He believes Web3 will change the world and wants everyone to be a part of it.
