Afghanistan’s Crypto Lifeline

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Crypto has become one of the only ways to reliably send money in and out of Afghanistan, where banks are stuck in a perpetually sanctioned, purgatorial state. whatpaula reports on how the embattled digital currency is shoring up a country in dire straits

Arezo doesn’t recall exactly how it happened. She remembers watching news footage of the Taliban milling around the presidential palace after then-President Ashraf Ghani fled Afghanistan, their rifles on display atop his lofty, glass-top desk. She remembers being forced to leave her job, which she loved, as a web designer and reporter’s assistant.

For crypto-enthusiasts, the blockchain’s potential to create a bank-free utopia is best observed in countries whose economy is, in some way or another, compromised. Despite the cultish grift that has come to define crypto in the United States, a use-case like Afghanistan acts as a sort of paragon of its initial objective: decentralized global finance. But while it’s true crypto use in Afghanistan continues to scale, so too do the concerns around it.

As the country’s economy spiraled then stalled, the U.S. Treasury issued general license after general license, insisting it was perfectly fine to send money in and out of Afghanistan, but the banks remained, for the most part, unwilling to risk it. Some organizations turned to the Hawala networks, but fears of Taliban interference, along with the fact that Hawala wasn’t used by formal vendors or available in many countries, made it less practical. Crypto, in effect, was a last resort.

Programs like Code to Inspire and LearnAfghan have always been a rarity, but, under the Taliban, their work is exponentially harder. Code to Inspire is technically registered as an NGO, but the Taliban forced them to shut their doors shortly after they took power, along with a number of other local organizations, declaring their licenses invalid. After over a year, they’ve finally gotten the renewal, says Forough, and plan to re-open their physical location later this year.

In the world of humanitarian aid, unreliable local currency is not at all uncommon. Crypto-curious NGOs have begun experimenting with the technology in places like Ukraine, Kenya and Uganda, where local economies are similarly debilitated—though many organizations remain reticent about it, wary of backlash from potential donors. “The main concern,” says Centrella, “is with the public narrative and it just being a subject that will have controversy around it.

 

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