Taliban outlaws crypto in Afghanistan and starts arresting token traders

The Taliban regime in Afghanistan has arrested several dealers of cryptocurrency tokens who resisted instructions to halt selling digital assets after the country’s central bank this month placed a national ban on crypto.

The crackdown is a response to the fact that some Afghans have begun to store their riches in cryptocurrency in order to protect it from the reach of the Taliban, according to a senior Afghan police official who spoke with Bloomberg.

“The central bank gave us an order to stop all money changers, individuals, and businesspeople from trading fraudulent digital currencies like what is commonly referred to as Bitcoin,” Sayed Shah Saadaat, head of criminal investigations at the police headquarters in Herat, said by phone. 

According to Saadaat, thirteen persons were detained, although the majority of them were later freed on bail, and more than twenty enterprises linked to cryptocurrencies were also closed down in the city of Herat, Afghanistan’s third-largest city and a center for dealing in digital tokens. 

In Afghanistan, there are a total of six cryptocurrency brokerages; four of them can be found in the capital Kabul, which is around 121 kilometers (75 miles) from the border with Iran.

Afghanistan strengthens crypto ban

Since the nation is cut off from the global financial system because of the sanctions imposed on the group, the use of cryptocurrency as a means of transferring money into and out of the country has grown more common.

In the aftermath of a market crisis that wiped away almost $2 trillion of value and forced numerous high-profile enterprises into bankruptcy, governments ranging from South Korea to the United States are strengthening crypto regulations. 

However, outright bans on cryptocurrencies are considerably less common. Following China’s lead, Afghanistan has joined the ranks of countries that have made all cryptocurrency transactions illegal.

Finbold first reported last year that Afghan women were turning to crypto amid limited access to financial services.