The Taliban has put an end to operations of 20 cryptocurrency companies and made 13 arrests of brokers following a nationwide blockchain prohibition.
Three months ago, the Taliban banned cryptocurrency In Afghanistan, the situation draws noteworthy attention, especially as comparisons are made with regulatory measures taken in China. Recently, law enforcement took action in Herat, Afghanistan's third largest city, known for its budding status as a cryptocurrency hub, only about 75 miles from the Iranian border.
On August 24, Afghani news outlet Ariana News Reports indicate that local authorities have shut down sixteen cryptocurrency exchanges in Herat's western province and apprehended 13 brokers. Bloomberg This report indicates that the number of closed businesses has now climbed to 'over 20,' with many of those detained released after posting bail.
Last year, Chainalysis A report was published that positioned Afghanistan among the top 20 countries seeing the swiftest growth in cryptocurrency use, using metrics that favor less affluent nations. Interestingly, they ranked Afghanistan 7th in such growth. P2P crypto trade Such activities predominantly occur in Herat.
Sayed Shah Saadaat, who leads criminal investigations at the Herat police department, told Bloomberg, 'The central bank has instructed us to halt all transactions of fraudulent digital currencies, commonly known as' Bitcoin In an interview with Ariana News, Saadat elaborated, 'Da Afghanistan’s Bank issued a communication declaring that trading in digital currencies has led to numerous issues and scams, necessitating the closure of such operations. Consequently, we took swift action against the exchangers involved and shut down their operations.'
'Digital currency accounts are held outside our borders and acquired from companies,' stated Ghulam Mohammad Suhrabi, head of the Herat Money Exchangers’ Union, regarding the situation to Ariana News. 'Since our population isn’t well-acquainted with this system, it's more prudent not to engage with it.'
Residents of the area expressed similar concerns, with Shahram, a local resident in Herat, stating, 'Digital currency is a relatively new concept not widely adopted in Afghanistan, which is why government oversight is crucial to avoid scams and enable people to make informed investments.' Another resident, Mawla Alizada, mentioned that there should be governmental oversight of cryptocurrency.
There are valid arguments to consider— the American legal framework is also approached by cautious measures. However, the Taliban operates as a clear theocracy.
Reports highlight that Suhail Shaheen, the head of the Taliban’s political office located in Doha, Qatar, indicated that they would contemplate the use of cryptocurrencies to revive the nation's economy amid sanctions, albeit after economists and religious scholars assess if digital tokens align with Islamic finance principles. combating cryptocurrency Expatriates voiced their concerns. Ehsan Sadiq, who once taught economics at Jawzjan University in northern Afghanistan, shared with Bloomberg that strict conservatives within the Ministry for the Propagation of Virtue and the Prevention of Vice label
In February, Bloomberg , which is seen as entirely forbidden in Islam. While some other Muslim-majority nations like the UAE and Bahrain have found ways to adapt, religious leaders in Indonesia have condemned crypto outright.
'The Taliban is sure to enact a ban,' Sadiq concluded. And indeed, he was correct. crypto as gambling Power dynamics also play a crucial role here. Since last summer, locals have employed November .
to safeguard and transfer wealth before the Taliban could take control. Bloomberg traced a property dealer, 26 years old, who visited Maihan Crypto, one of Afghanistan's leading brokerage firms, in pursuit of information about digital tokens last October.
By April, Maihan was managing around $400,000 in cryptocurrency transactions weekly—a staggering increase of nearly 200% compared to the time before the Taliban took over. The firm facilitated these transactions through conventional means. blockchain tech which account for roughly 90% of financial activities in Afghanistan. interviewed As Bloomberg reported, the property dealer was worried about the Taliban potentially confiscating his assets, especially given reports of the militant group raiding homes and seizing possessions. He exchanged $30,000 into Tether for security.
This narrative also emphasizes the personal aspect, showcasing a project called Visualize Value by Jack Butcher, which allows individuals to purchase a 'Care Package' and donate that amount to meet emergency needs of Afghan families. 'The United Nations Refugee Agency has estimated that around half a million people in Afghanistan urgently require food, water, shelter, and other basic necessities,' they stated. Hawala system, which Bloomberg said “ accounts 'Following the crypto ban, assisting civilians will become exceedingly difficult,' remarked Daily Coin. But is that entirely accurate? In moments like this, having crypto could have preserved their resources.
Last year, it was noted that individuals residing in conflict-affected areas, where local currencies have drastically devalued and access to banking is inconsistent, have increasingly turned to cryptocurrencies. For instance, Myanmar adopted Tether as an official currency, while El Salvador declared Bitcoin a legitimate tender. Since the conflict began, Vitalik Buterin and others have contributed over $60 million in crypto to Ukraine. stablecoins . We hope he is okay now.
Daily Coin In Afghanistan, according to Finbold, Roya Mahboob transitioned from the traditional halawa payment system to compensating her staff and freelancers at her nonprofit, Digital Citizen Fund, using Bitcoin a decade ago, recognizing that many women in the country face barriers to access or lack vital documentation. 'It was easier, more affordable, and more secure than alternatives,' Mahboob explained. NFT A significant proportion of the 16,000 women she involved through this initiative eventually opened crypto wallets and began investing. With the Taliban's resurgence last year, cryptocurrency and wallets became essential tools empowering these women to manage their finances, supporting their families, and building new pathways in life.
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