Afghans Have Become More Open To Cryptocurrency Amid US Sanctions.
Since the Taliban seized control of Afghanistan in August of last year, US officials have shut off funding sources in order to undermine the state’s economy. As a result, money transfers have become a major issue for Afghans. Because of US sanctions, Afghans are unable to receive foreign help. However, cryptocurrencies emerged as an alternate payment channel to save them.
Farhan Hotik, a global traveling journalist from the region Zabul, was left with no money in his pocket as the Taliban took possession. The only thing that let him flee overseas was a few dollars in Bitcoin.
He cashed out his earnings from a virtual wallet and fled to Pakistan with his family of ten siblings. Farhan said:
After the Taliban takeover, crypto spread like wildfire over Afghanistan. There is almost no other way to receive money.
Notably, Farhan and his buddies utilize the Binance exchange, which allows P2P trading, in which network users may sell and purchase digital currencies directly with one another. He educates people about crypto-mania and teaches in Afghanistan that digital assets have value even if they do not exist in physical form.
Alternatively, banks were unable to manage the crisis and ceased operations, forcing individuals to rely on cryptocurrencies to trade and, more importantly, to survive.
It is also worth noting that Google searches for ‘crypto’ and ‘Bitcoin’ increased in July, prior to the Taliban taking control of Kabul, and Afghans preferred cashing out their money rather than going to banks.
Similarly, the Taliban’s takeover has expedited the use of digital currency in Afghanistan. According to a Chainalysis survey from last year, Afghanistan has become the 20th country to rapidly adopt cryptocurrency out of 154.
A year before that study, the research organization disclosed that it planned to omit Afghanistan from its list of crypto-presence nations due to its low acceptance rate.
Sanzar Kakkar, an Afghan American who developed the app HesabPay for Afghans in 2019 that allows users to transfer money using virtual currencies, believes that the country’s crypto revolution may be traced to US sanctions on the Taliban.
The US sanctions imply that all transactions with Afghan banks would be halted. Along with halting dollar transfers, US officials have frozen $7.1 billion in assets belonging to Afghanistan.
Furthermore, the Swift system, also known as Worldwide Interbank Financial Telecommunication, has ceased all activities with Afghans, rendering them unable to utilize its system for international financial transactions.
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