crypto strategy

Afghan police shut down cryptocurrency exchanges to enforce central bank ban: report

Police shut down at least 16 cryptocurrency exchanges in Herat province in western Afghanistan last week, according to a report by Ariana News, an independent news outlet in that country. The report quotation a local police official said arrests had been made during the lockdowns.

The closures were made in response to a ban on crypto trading that had been in place for about three months, according to the report. He was apparently referring to a ban on online currency trading imposed by central bank Da Afghanistan Bank in June. A central bank spokesperson Told Bloomberg at that time:

“There is no instruction in Islamic law to endorse it [online forex trading]. As a result, we banned it.

Head of the Herat Money Exchangers Union, Ghulam Mohammad Suhrabi, told Ariana News: “Digital currency accounts are outside the country and are purchased from businesses. Our people don’t know about it, so it’s better not to use it.

Ariana News reported in July that the central bank begin prosecute Afghans who have violated the ban. The central bank said it had not issued any licenses for online trading, making any such activity illegal, the publication reported.

The use of cryptography skyrocketed in Afghanistan after the Taliban took over the country in 2021 and Afghanistan’s fragile economy was further destabilized. Foreign remittances have become harder to receive because Western Union and Swift have left the country, sparking interest in crypto. According to an Al-Jazeera report in March, there was a WhatsApp group devoted to the cryptocurrency trade which had 13,000 members in Herat.

Crypto has also proven to be a valuable conduit for Western aid to Afghanistan. Organizations such as Women for Afghan Women have used crypto to deliver aid in the country.