Cardano chief Hoskinson predicts a larger role for cryptocurrencies in Afghanistan

Cardano’s Charles Hoskinson says crypto could play a larger role against the Taliban.

Key Takeaways

Cardano Chief Charles Hoskinson thinks cryptocurrencies will see wider adoption in Afghanistan
The Taliban swept to power last month.
Cash shortages in the country could draw both the Taliban and its opponents towards crypto.

YEREVAN (CoinChapter.com) — Cardano founder Charles Hoskinson said he expects cryptocurrencies to play a larger role in Afghanistan.

In a conversation with CNBC on Tuesday, the Ethereum co-founder predicted that Cryptocurrencies could see increased adoption in Taliban-controlled Afghanistan due to the rising need for more privacy.

“It is my belief that cryptocurrencies are going to play a larger role in Afghanistan this time around, in the war for and against the Taliban forces,” Hoskinson said on CNBC’s “Squawk Box Asia.”

Cryptocurrency, the agency Afghans need?

In August, the Taliban deposed the elected Afghan Government and established control over the country. As a result, the international community hurried to evacuate their citizens from Afghanistan.

The United States pulled out its last troops from Kabul on 30 August. It had established a proxy control of the country for 20 years. Now, as they left, they watched the Taliban consolidate power.

The withdrawal left the Afghan citizens with an uncertain future as reports of Taliban crackdown on citizens began circulating.

“Afghan’s digital life is now under scrutiny, the last two decades are being reviewed by a regime that if you expressed your opinion in ways that don’t fit their regressive viewpoints you are now under threat of harassment, imprisonment or even death.”

The utter disregard for human rights on the Taliban could result in Afghans swarming towards crypto adoption.

Cryptocurrencies, a boon or bane for Afghans?

Ever since the US imposed sanctions on the Taliban, cash shortages have been a major issue.

The International Monetary Fund (IMF) also denied the Taliban access to millions in funding to Afghanistan, making matters worse.

Thousands of Afghans returned from banks empty-handed, as the Central Bank failed to supply cash to its commercial subsidiaries. Moreover, those fleeing the country were unable to claim their lives’ savings in FOREX. As a result, the dollar shortage had gripped the nation.

Amid the crisis, many pointed out how the adoption of crypto could have solved the problem. Others highlighted how the technology could have left the Taliban without enough resources. Instead, it depends on the financial resources it captured by force to operate.

However, there were also fears of crypto misuse, with some pointing out cases where tech-savvy terror outfits had used BTC and altcoin to fund terror activities.

Crypto could be used by either side to their advantage

According to the Cardano chief, both sides could use crypto to their advantage. While the Taliban could use it to strengthen its hold, cryptocurrencies could become an agency of resistance for those fighting against it.

Either way, according to Hoskinson, cryptocurrencies will play a role in the whole fiasco.

“It’s going to be really interesting to see how that gets integrated into statecraft and how that gets integrated into resistance against a regime that clearly doesn’t care for the rights of many people and clearly wants to put in a theocracy that belongs more in the 13th century than the 21st century.”

Crypto adoption is nothing new in Afghanistan

The CEO of Input Output Hong Kong (IOHK) expects cryptocurrencies to play a major role in Afghanistan. However, the country has not remained aloof of the technology.

According to Chainalysis data, Afghanistan is 20th out of 154 countries in terms of Bitcoin adoption.

The 20 countries in 2021 Global Crypto Adoption Index. Credit: Chainalysis

Weeks before the Taliban took over Kabul, and reports suggested Google searches for crypto and Bitcoin in Afghanistan were on the rise.

This is not the first time Hoskinson had suggested cryptos as a solution to the Afghan problem. In a video message to followers, he had called for a change of traditional financial systems.

“I firmly believe if we change our money, and we change the institutions of how our democracy works, collectively over time as nation-states, even if they exist in their existing form, we will stop tolerating these things,”
the Ethereum co-founder said.

In the meantime, countries are trying to figure out their future course of collaboration with the Taliban. It will be clear in the days to come what roles cryptos play in Afghanistan.