Taliban Arrests and Jails 8 People for Holding and Trading Crypto

UTC by Tolu Ajiboye · 3 min read
Taliban Arrests and Jails 8 People for Holding and Trading Crypto
Photo: Depositphotos

Crypto traders in Afghanistan are being arrested and imprisoned by the Taliban for dealing in digital assets despite the country’s crypto ban.

The Taliban regime in control of Afghanistan’s government arrested and jailed eight traders for holding and using crypto. The detainees were arrested in Herat, the country’s third-largest city.

Taliban Sends Afghani Crypto Traders to Jail for One Month

According to one of them, who pleaded anonymity to Crypto.news, the eight persons were arrested in May and spent 28 days detained in Herat’s central prison. While two of the affected persons said the Taliban did not confiscate their crypto assets, reports suggest that the Taliban recently arrested a group of traders and seized all their crypto. There are also indications that the government may put some crypto traders in jail for up to six months.

In 2022, the Taliban regime banned cryptocurrency in Afghanistan, enforcing the ban through the country’s central bank. The immediate response was one of resistance after the announcement, as people complained crypto was the only way to transfer funds to and from the country. This was the result of several sanctions levied against the government in protest of the Taliban regime. As investors continued to resist, the regime decided to arrest traders and close several firms. At least 20 crypto businesses closed down in Herat as of August.

Many have decried the ban, complaining about the economic effects of their inability to trade. For instance, one trader who used to earn between 1% and 2% from selling USDT said he could no longer afford to feed his family. While he knows that continuing the trade puts his life in danger, he believes “there’s no other way.” Another person said his family lives off Bitcoin (BTC) and USDT remittances from his brother, who lives in the US.

Crypto Ban in Afghanistan

Before the ban, the Taliban’s takeover significantly affected the country’s crypto landscape. According to a 2022 report from blockchain analytics firm Chainalysis, Afghani citizens received about $68 million worth of crypto every month via remittances. In September 2021, the received value was $150 million. However, following the Taliban’s takeover, the figure fell to less than $80,000.

While digital assets are banned in Afghanistan, the Taliban regime is likely not against blockchain technology in general. Last December, Algorand Foundation announced an investment in Afghani interoperable digital payments platform HesabPay, through Algorand Ventures, the launch and support arm of the Foundation. Initially designed as a platform to ease the humanitarian aid crisis, allowing several organizations to send aid to Afghanistan, HesabPay has now expanded its use cases. Users can now perform several other transactions, like paying electric bills, buying airtime, and sending funds to other users.

In a press release, Algorand Foundation explained that the investment will see HesabPay use the Algorand blockchain to facilitate payments and optimize its processes with greater speed and reliability. The release states that the platform is a “critical tool for Afghanistan” especially because, according to the World Bank, 85% of the adult population is unbanked.

Cryptocurrency News, News
Related Articles