Crypto helps some in Afghanistan. Arezo Akrimi pulls out her smartphone in the middle of a bazaar in western Afghanistan. And with a few taps of the screen. Exchanges some bitcoin for a large sum of actual cash.
Akrimi, 19, is one of 100 students in Herat who have received around $200. In cryptocurrencies per month since September. Courtesy of the American non-governmental organization Code To Inspire.
This sum, which she translates into Afghanis at a bureau de change. It is critical for her family of six. As it pays the rent and helps to provide food.
After 20 years of military occupation, Afghanistan’s economy has virtually collapsed. Since the Taliban retook control in August. The country is now in the grip of an economic crisis. Brought on by the seizure by the United States of billions of dollars’ worth of assets. In the wake of the country’s withdrawal. From the international community.
The decision by foreign financial institutions to restrict assistance to Afghanistan. This has made economic recovery even more difficult. And the country’s diplomatic isolation as the “Islamic Emirate of Afghanistan.” As the Taliban’s administration refers to the country, has not helped the situation.
While international sanctions have had little effect on digital currencies. And their decentralized architecture. A small number of young Afghans are benefiting from this technology. As well as escaping from the worst of the situation.
According to the AFP news agency, Akrimi expressed surprise. At the possibility of the weapon being used in Afghanistan. “It was quite beneficial.”
Code To Inspire was Created to Teach Coding
Code To Inspire was established to teach computer programming to women in Herat. But its high-tech approach is now also assisting students. In the economically disadvantaged country in obtaining financial aid.
Because of Western sanctions. It is nearly impossible to send money. From one bank account to another in Afghanistan right now.
However, even those who have money in a bank face difficulties in withdrawing it. Individuals are restricted to taking the equivalent of $200 each week. While enterprises are restricted to $2,000 per week.
Even for those purchases, customers must also wait in line for several hours.
Fereshteh Forough, the NGO’s founder. Told AFP that cryptocurrency transfers have enabled the organization. To avoid these roadblocks. While also assuring that each donation reaches people who need it the most.
According to the American, whose parents fled Afghanistan in the 1980s. “Crypto is an incredible tool for people living under authoritarian regimes. To overcome all kinds of political and economic sanctions.” “Crypto is also a tool that can change the lives of people. Living under authoritarian regimes,” the American says.
In order to ensure the financial stability of its pupils. The NGO refrains from paying them in Bitcoins. A well cryptocurrency, the price of which fluctuates dramatically. On a regular basis.
This is in contrast to Bitcoin, which is considered a “stablecoin.” Because its value is supported by the US dollar.
“One BUSD is equal to one dollar,” Forough explains.
Crypto Helps Some Coverts
According to forex broker Hamidullah Temori. Cryptocurrencies are gaining followers in Herat, Afghanistan’s second-largest city.
Many of his new customers come to exchange digital assets sent by relatives. From abroad into Afghanis.
He told AFP that since the Taliban came to power. Cryptocurrency also transfers have grown by 80%.
Transfers are quick and commissions are substantially lower than Western Union. Or hawala transactions, which Afghans prefer. Outside the banking system are Hawala cash transfers.
In Kabul, Noor Ahmad Haidar has been forced into crypto.
Beginning in early 2021, the young guy began exporting saffron to the US. Also UK, Australia, and Canada.
“I skip the frantic bank transfer process,” he says.
“Since August, it’s also been the sole and most convenient option.”
In its 2021 Global Cryptocurrency Adoption Index. Chainalysis rated Afghanistan 20th out of 154 nations for “grassroots take-up”.
Kim Grauer, the firm’s research director, believes it isn’t solely. Due to the Taliban taking charge.
“It’s partly because there are more alternatives for trading cryptocurrency on your phone. And more people understand it.”