Crypto is playing an important role for organizations looking to send financial aid to Afghanistan. Around 24.4 million afghans are in humanitarian need, but strict rules and sanctions forbid money to go into the country by traditional means.
Immediate Support Is Needed
Since the Taliban took over, the country has reached the verge of collapse. The price of basic goods is rapidly rising, borders are closed, there is a cash and food shortage, a plunging currency, billions of frozen assets, over half a million Afghans have lost their jobs.
Afghans are desperate. There are reports of parents who have sold their children into marriage for money and food.
“We only have water and bread — sometimes we have it, but sometimes there’s nothing to eat,”
-Musafer, a laborer, told CNN
Money transfer services have been discontinued. The country was cut off from the global economy. The majority of citizens do not have bank accounts; banks close for long periods of time, and there are strict withdrawal limits.
“By the middle of this year, it’s expected that job losses will increase to nearly 700,000 – with direst predictions topping 900,000 – as a result of the crisis in Afghanistan and “restrictions on women’s participation in the workplace”.”
The UN cites Ramin Behzad, Senior Coordinator of the International Labour Organization (ILO) for Afghanistan: “The situation in Afghanistan is critical and immediate support for stabilization and recovery is required. While the priority is to meet immediate humanitarian needs, lasting and inclusive recovery will depend on people and communities having access to decent employment, livelihoods and basic services.”
The Role Of Cryptocurrencies
“Cryptocurrency, if anything, is going to where there is a lack of digital infrastructure, and encouraging development of infrastructure by increasing demand for digital services,” Keith Carter, an associate professor at the National University of Singapore School of Computing, told Thomson Reuters Foundation.
But the UNESCO Institute of Lifelong Learning reports that Afghanistan’s literacy rate is just 43% –around 21 million Afghans do not know how to read or write–, so how could anyone talk of crypto adoption in the country?
The adoption of crypto by most citizens seems like an unfeasible scenario, but crypto is already helping in other ways.
The Intercept reports that several non-governmental organizations (NGOs) and humanitarian organizations have been adopting –or considering adopting– crypto as an alternative to send aid to Afghanistan.
The news organization quotes Fereshteh Forough, founder of the school Code to Inspire, where they teach computer programming to young Afghan women. Forough could not let her students starve, so she tried to send them emergency checks. The banks, JPMorgan Chase included, blocked her transactions in fears of the U.S. sanctions –even though humanitarian aid is supposedly allowed.
Forough then started using crypto and now sends money to her students in the stablecoin BUSD, which then the woman change to the local currency.
“Since September, we’ve been sending cash assistance, about $200 per month, for each family, because the majority of our students have said their family lost their jobs. They are the sole breadwinner of the family… We created a safe way for our girls to cash out their crypto and pay for expenses, so they can pay for medical expenses and food and everything that’s needed.”
Crypto has become a way to bypass the Taliban and deliver assistance. Citizens from other nations in times of crisis like Venezuela, Turkey, Iran, and North Korea, are also using it to face the plunging currencies and avoid sanctions.