Afghans look to bitcoin’s stability after Taliban takeover

Bitcoin adoption in Afghanistan has increased as citizens seek stability in the face of cash shortages and rising prices following the Taliban takeover.

Afghans have been using bitcoin to store and exchange value since the Taliban took control of most of the country. On August 15, hundreds of residents of Kabul, the country’s capital, rushed into banks to withdraw cash as Taliban fighters took control of the city demanding the government surrender – but only to hit a brick wall. Cash shortages, intense restrictions and a constantly devaluing local currency have pushed Afghans to seek alternatives and find bitcoin.

“A nationwide shortage of liquidity, closed borders, a local currency hitting record highs and rapidly rising commodity prices; this is why some Afghans I have spoken to are turning to crypto -currencies like bitcoin, “said MacKenzie Sigalos of CNBC.

Cryptocurrencies have been the most sought after solution, given their digital nature, for those looking for some monetary sovereignty to escape the country, according to CNBC and data from Chainalysis. Some Afghans have chosen to embrace bitcoin to protect their money, create and preserve their wealth, and achieve high sovereignty to flee the country with their savings. Others have bet on cryptocurrencies, desperately seeking to increase their income during the current crisis in Afghanistan.

Afghanistan has seen increased adoption of bitcoin despite the significant hurdles its citizens often face, including limited internet access and frequent power outages. Out of 154 countries analyzed by Chainalysis’s 2021 Global Bitcoin Adoption Index, Afghanistan ranked 20th. The index, which considers the purchasing power parity (PPP) per capita of each country as a weighting factor, mainly takes into account the use of bitcoin by ordinary citizens rather than by institutional and professional actors. In terms of peer-to-peer exchanges, Afghanistan ranks even higher, coming in seventh.

Over time, Bitcoin can preserve value and increase purchasing power better than domestic fiat currencies and other cryptocurrencies. With limited supply and predictable monetary policy, the world’s only peer-to-peer electronic money is uniquely positioned to empower the unbanked, those under authoritarian regimes, and those facing adverse economic policies and depreciation. currency. While Afghans are denied access to their legitimate fiat savings due to cash shortages, some have already started to familiarize themselves with bitcoin, allocating their family savings to the most tangible form of money they can. to access. Bitcoin is the definitive answer to help them secure financial sovereignty and preserve wealth for generations to come.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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