Key Takeaways
The country’s central bank made the use of crypto illegal a month ago.
The ban is now being enshrined in law of the Taliban. 13 persons have been taken into custody in Herat, and 20 enterprises have been shut down as a result of the investigation.
Prior to the prohibition, cryptocurrencies were a popular method of communication because they help individuals to conveniently store wealth or move it across huge distances. This made cryptocurrencies appealing to a wide audience.
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The central bank of Afghanistan has labelled certain cryptocurrencies that can be traded as “fraudulent digital currencies,” thus the Afghan police are cracking down on anyone who deal in them.
“Fraudulent” Currencies
The Taliban are making plans to target cryptocurrency owners.
The Taliban leadership in Afghanistan is reportedly prosecuting cryptocurrency dealers who are disobeying instructions to halt dealing digital assets, as stated in a statement that was just published by Bloomberg. The move comes a month after the country’s central bank issued a blanket ban on cryptocurrencies like bitcoin and ethereum.
According to Sayed Shah Saadaat, the chief of ongoing cases for the Herat police department, “the central bank handed us an order to halt any money changers, individuals, and entrepreneurs from dealing fake digital currencies like what is widely referred to as Bitcoin.”
Herat is the third largest city in Afghanistan, and rumors have it that it’s where four out of Afghanistan’s six digital currencies are located. According to Saadaat, 20 cryptocurrency-related enterprises had been shut down in the city, and 13 people had been arrested.
Before the country’s central bank issued a general prohibition on the technology, there was a significant amount of interest in cryptocurrencies in Afghanistan, particularly stablecoins. They provide consumers with a safe way to store riches as well as a method to transfer money inside (or outside of) the country. Stablecoins are a type of cryptocurrency that aspires to maintain a value that is equivalent to that of government-issued currencies such as the euro or the United States dollar.
Since the early 1990s, economic sanctions of a severe nature have been imposed on Afghanistan. Shortly after the Taliban regained power and conquered Kabul, the Biden presidency slapped a new wave of sanctions against Afghanistan. Additionally, the government seized more than $7 billion of Afghan treasury funds that were stored in the Federal Reserve Bank of New York.
Afghanistan is hardly the only nation adopting a hard line against cryptocurrencies and related activities. Lately, Russian President Vladimir Putin gave his approval to a piece of law that makes it illegal to make payments using cryptocurrencies. This was done in an effort to preserve the value of the currency. In the summer of 2021, China became famous for passing a law that outlawed cryptocurrency and the mining of Bitcoin.
Disclaimer: At the time that this article was written, the author of this piece owned ETH in addition to a number of other cryptocurrencies.
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