“The Bank of Afghanistan has let us know by letter that digital currency trading has caused a lot of problems and is scamming people, so it is necessary to close it,” the head of the Police Crime Unit explained on television. of Herat, Sayed Shah Sadat.
The Police of said city – the third largest in the country and an epicenter of cryptocurrency mining and exchange – released most of the detainees on bail, while closing 20 companies and businesses linked to these digital currencies.
The Afghan central bank had already prohibited the exchange of foreign currencies through virtual platforms last month, as there was “no instruction in Islamic law that approves it”.
Today’s move represents a blow to those who turned to cryptocurrencies in the country, which, due to sanctions imposed by the United States and its allies since the Taliban returned to power in August last year, is disconnected from the banking system. swift international.
The country, in addition, stopped receiving humanitarian assistance from international organizations -which represented, before the Taliban coup in August 2021, 40% of the GDP-, it cannot access US$ 9,000 million in international reserves after being blocked by United States and local banks are prevented from granting loans.
In this framework, cryptocurrencies had become for Afghans a tool for preserving value and for moving money in and out of Afghan territory, despite the fact that internet access -necessary for their use- represented a barrier to their use.
Local search for the term “crypto” via Google had accelerated sharply since the months before the Taliban takeover, as indicated by data from Google Trends; while the research firm Chainalysis ranked Afghanistan in a report as one of the top twenty countries in the world in terms of cryptocurrency adoption.
Despite the fact that the Government, last February, indicated that it was under analysis to allow its use, the Taliban’s decision was not unexpected: some academics had been anticipating for some time that cryptocurrencies were going to be prohibited for having elements of “bet and uncertainty”, contrary to the Islamic fundamentalism that they preach.
However, other Muslim-majority countries have adopted a more permissive approach, such as Bahrain and the United Arab Emirates, a country that allows cryptocurrency trading in the Dubai free zone.
The regulation of cryptocurrencies varies between countries: while nations such as the United States and the United Kingdom are applying and analyzing a regulatory framework, few countries -such as China and Bolivia- have ordered a total ban on transactions so far.
Source: Ambito
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