key takeaways
- The Central Bank of Afghanistan declared cryptocurrencies illegal last month.
- The Taliban government is now enforcing the ban. Thirteen people were arrested in Herat and 20 businesses closed.
- Cryptocurrencies were a popular technology before the ban because they offered users the ability to store wealth or transfer wealth easily over long distances.
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Afghan police forces are targeting cryptocurrency traders for what the country’s central bank now considers “fraudulent digital currencies.”
“fraudulent” currency
The Taliban are looking for cryptocurrency owners.
According to a new report Bloombergthe Taliban regime in Afghanistan is arrest Cryptocurrency traders who ignore orders to stop trading digital assets. The crackdown comes a month after the country’s central bank imposed a nationwide cryptocurrency ban.
Sayed Shah Saadaat, head of criminal investigations at Herat Police, said: “The Central Bank has ordered us to stop all money changers, individuals and merchants from trading in fraudulent digital currencies such as those commonly referred to as Bitcoin.”
Herat is the third largest city in Afghanistan; it reportedly hosts four of the six Afghan cryptocurrency exchanges. Saadaat claims that 20 cryptocurrency businesses in the city have closed and 13 people have been arrested.
Demand for cryptocurrencies, especially stablecoins, is High Before the Central Bank of Afghanistan completely banned the technology. They provide users with a safe store of wealth, as well as a way to move funds abroad (or abroad). Stablecoins are cryptocurrencies designed to maintain parity with government-issued currencies such as the U.S. dollar or the euro.
Afghanistan has been the subject of severe economic sanctions since the 1990s. The Biden administration imposed a new round of sanctions shortly after the Taliban returned to power and occupied Kabul; it also seized more than $7 billion in Afghan treasuries held by the Federal Reserve Bank of New York.
Afghanistan is not the only country taking a tough stance on cryptocurrencies.In order to maintain the stability of the ruble, Russian President Vladimir Putin recently sign Legislation that makes crypto payments illegal.China is also famous prohibit Cryptocurrency and Bitcoin mining in the summer of 2021.
Disclaimer: At the time of writing, the author of this article owns ETH and several other cryptocurrencies.
