Budapest Post

Cum Deo pro Patria et Libertate
Budapest, Europe and world news

Turning on crypto means turning our backs on vulnerable millions

Turning on crypto means turning our backs on vulnerable millions

Remittances in Bitcoin help vulnerable people in unstable economies, like Afghanistan. Crypto regulation means cutting them off.

Cryptocurrency remittances are now a lifeline for Afghans, after the abrupt US withdrawal led to Western Union temporarily ceasing operations, and banks in the country severely limiting withdrawals.

As regulators in remittance source countries like the US and UK turn their sights to crypto, they should remember how indispensable those currencies are to some of the world’s most vulnerable people.

Crypto will become increasingly indispensable as the local currency - in Afghanistan and elsewhere - becomes not only difficult to access but unreliable as a store of value. Conflict fuels inflation, which makes currencies less valuable, or sometimes worthless.

If we regulate cryptocurrency transfers to appease the crypto hawks at home, we risk turning our backs (again) on those who need this asset class the most; the Afghani people and many others like them.

Afghanistan: A textbook use case for cryptocurrency


With the Taliban takeover comes the freezing of Afghanistan’s financial system too. Foreign aid has halted, which makes up approximately 40 per cent of Afghanistan’s GDP according to the World Bank. Similarly, foreign reserves of the Afghanistan central bank have been frozen, which is approximately $9 billion.

What’s more, in response to the Taliban’s take-over and western countries halting foreign aid, international money transfer companies like Western Union and Moneygram shut off their services (in some cases they have now resumed activity, for now), leaving the average Afghani with no way to engage with the global financial system and crucially no way to receive remittances from relatives abroad.

Remittances, the practice of sending money ‘back home’ from rich countries, makes up approximately 4 per cent of the country’s GDP. In an economy that is so heavily cash-dependent, the sudden crumbling of the local financial infrastructure may well mean the difference between life and death for many Afghans.

For remittances to continue to be a lifeline, they need to be fast. When money is needed, it is often needed instantly. An internally displaced person, for example, cannot wait for 3-5 days whilst funds are cleared; they need food, fuel, and medical supplies today.

Bitcoin ‘maximalists’ make wide-eyed claims about how crypto will change the global economic system. Whether you believe them or not, we can see that crypto has already revolutionised remittances in unstable, conflict-ridden places. Afghanistan presents a textbook use case for cryptocurrencies in failed states.

Crypto use accelerates in countries with hyperinflation


Sometimes, sheer necessity creates the strongest argument for new tech. Afghanistan is 20th on the list of 154 countries in the Global Crypto Adoption Index formulated by Chainalysis, a Blockchain data platform. When adjusted for peer-to-peer transactions (including remittances), it ranks 7th. In 2020, Afghanistan didn’t even make the list.

Afghanistan is not alone. Crypto usage has spiked recently in Lebanon, Turkey, and Venezuela. Those people are not trying to get rich - they are simply trying to receive funds from relatives abroad, and stop their wealth from disappearing at a time of high inflation.

Sending and receiving money through Bitcoin and other cryptocurrencies is growing in Afghanistan


Venezuelan-based crypto consultant Jhonnatan Morales has observed, “Many people are mining and trading cryptocurrencies not to acquire products, but to protect themselves from hyperinflation.” Venezuela has the third highest crypto usage in the world. It also has one of the highest rates of inflation (up to 2,940 per cent).

Lebanon is another example. As the Lebanese Lira lost 80 per cent of its value, Lebanese downloads of Bitcoin wallet BlueWallet, for example, grew by 1,781 per cent in 2020, compared with the same period in 2019.

But Afghanistan may be the most urgent and tragic case of why the 'global south' needs crypto. As cash becomes scarce, prices soar and as the Taliban loses the foreign aid the country was previously dependent upon, the already crumbling Afghani currency will get even weaker.

By allowing the Afghani people to receive, store and spend their wealth in Bitcoin, they may be able to protect themselves against the worst effects of a failed state.

Regulation must consider the most vulnerable


And this is what we must remember when we regulate cryptocurrencies in the west. That regulation will not just affect speculators; it will hit those who want to send remittances ‘back home’. Those who receive remittances have the most to lose.

When Federal Reserve chairman, Jerome Powell publishes his report on the next stage of cryptocurrency regulations, I hope that he doesn’t forget those who need cryptocurrency the most; the Afghani people, and millions across the world like them.

Whilst the west may have turned its back on the people of Afghanistan, we need to make sure that our laws don’t continue to leave them in the dark.

We need cryptocurrency regulation that ensures those vital financial lifelines are not. If we do, we are closing another door of hope for the people who need it the most.

AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
Newsletter

Related Articles

0:00
0:00
Close
JD Vance Warns Europe Faces “Civilizational Suicide” Over Open Borders and Speech Limits
Germany Enters Fiscal Crisis as Cabinet Approves €174 Billion in New Debt
Trump Administration Finalizes Broad Tariff Increases on Global Trade Partners
JD.com Launches €2.2 Billion Bid for German Electronics Retailer Ceconomy
Azerbaijan Proceeds with Plan to Legalise Casinos on Artificial Islands
IMF Upgrades Global Growth Forecast as Weaker Dollar Supports Outlook
House Republicans Move to Defund OECD Over Global Tax Dispute
France Opens Criminal Investigation into X Over Algorithm Manipulation Allegations
Trump Steamrolls EU in Landmark Trade Win: US–EU Trade Deal Imposes 15% Tariff on European Imports
ChatGPT CEO Sam Altman says people share personal info with ChatGPT but don’t know chats can be used as court evidence in legal cases.
Intel Reports Revenue Beats but Sees 81% Rise in Losses
Politics is a good business: Barack Obama’s Reported Net Worth Growth, 1990–2025
UN's Top Court Declares Environmental Protection a Legal Obligation Under International Law
"Crazy Thing": OpenAI's Sam Altman Warns Of AI Voice Fraud Crisis In Banking
The Podcaster Who Accidentally Revealed He Earns Over $10 Million a Year
UK Government Considers Dropping Demand for Apple Encryption Backdoor
Japanese Man Discovers Family Connection Through DNA Testing After Decades of Separation
Russia Signals Openness to Ukraine Peace Talks Amid Escalating Drone Warfare
Switzerland Implements Ban on Mammography Screening
Pogacar Extends Dominance with Stage Fifteen Triumph at Tour de France
President Trump Diagnosed with Chronic Venous Insufficiency After Leg Swelling
CEO Resigns Amid Controversy Over Relationship with HR Executive
NVIDIA Achieves $4 Trillion Valuation Amid AI Demand
Tulsi Gabbard Unveils Evidence Alleging Political Manipulation of Intelligence During Trump Administration
Centrist Criticism of von der Leyen Resurfaces as she Survives EU Confidence Vote
Trump Announces Coca-Cola to Shift to Cane Sugar in U.S. Production
FIFA Pressured to Rethink World Cup Calendar Due to Climate Change
Zelensky Reshuffles Cabinet to Win Support at Home and in Washington
"Can You Hit Moscow?" Trump Asked Zelensky To Make Putin "Feel The Pain"
Church of England Removes 1991 Sexuality Guidelines from Clergy Selection
Superman Franchise Achieves Success with Latest Release
Hungary's Viktor Orban Rejects Agreements on Illegal Migration
Air India Pilot’s Mental Health Records Under Scrutiny
Jamie Dimon Warns Europe Is Losing Global Competitiveness and Flags Market Complacency
Moonshot AI Unveils Kimi K2: A New Open-Source AI Model
Martha Wells Says Humanity Still Far from True Artificial Intelligence
Nvidia Becomes World’s First Four‑Trillion‑Dollar Company Amid AI Boom
EU Delays Retaliatory Tariffs Amid New U.S. Threats on Imports
Trump Proposes Supplying Arms to Ukraine Through NATO Allies
US Opens First Rare Earth Mine in Over 70 Years in Wyoming
Bitcoin Reaches New Milestone of $116,000
Severe Heatwave Claims 2,300 Lives Across Europe
Declining Beer Consumption Signals Cultural Shift in Germany
Emails Leaked: How Passenger Luggage Became a Side Income for Airport Workers
Polish MEP: “Dear Leftists - China is laughing at you, Russia is laughing, India is laughing”
Western Europe Records Hottest June on Record
BRICS Expands Membership with Indonesia and Ten New Partner Countries
Elon Musk Founds a Party Following a Poll on X: "You Wanted It – You Got It!"
China’s Central Bank Consults European Peers on Low-Rate Strategies
France Requests Airlines to Cut Flights at Paris Airports Amid Planned Air Traffic Controller Strike
×