Afghanistan is a country where peace is a luxury. Tribal conflicts, Taliban insurgency, and occupation by western military units have turned the country into a war zone that has ravaged the local economy bringing it to a shadow of itself in its heydays.
Recently, the Governor at the Central Bank of Afghanistan (CBA), announced that the lender of last resort is toying with the idea of issuing a sovereign Digital Token to crowdfund for mining, agriculture and energy sectors in the country with a hard cap of $5.8 billion.
This experiment can pass as a normal attempt by a cash-starved country to raise quick money for projects. However, the idea brings into perspective the opportunities that the use of Cryptocurrencies in Afghanistan can proffer as observed by a US military officer and the CEO of Horizen, Rob Viglione.
Real Life Experience Shows That Crypto Can Offer Financial Stability
Rob Viglione, gives his perspective on the role of Crypto in a country such as Afghanistan by first referring to his background as a US army data scientist who served in Iraq from 2003.
In his service, he gets a firsthand image of how war breaks down an economy and adversely affects individuals’ ability to make a decent living. In such an event, he discovers that Cryptocurrency has the ability to proffer financial stability. This is because Digital Tokens are able to cushion hodlers from market volatilities form by wars.
Rules-based Economy Are Restrictive
Formal, informal or even the underground economies have barriers of entry that can be exacerbated by turmoil. This can lead to alienation of a huge chunk of the population which is a catalyst for social unrest that can make conflicts to spiral out of control.
Rob believes that Cryptocurrencies, being decentralized and open source, can lower most of the barriers of entry which enables many people to be part of the value chain that the Crypto economy is creating in its rallies and growth of Blockchain and Crypto tech firms.
A Reason Why Crypto Adoption Is Surging In Some Unstable Countries
Decentralized economies that are built on Blockchain- where Crypto operate- are immune from social-political dynamics that can impact the global economy.
In countries such as Venezuela and Turkey where inflation is a normal macroeconomic hazard, many are turning to Crypto and other commodities to back up their assets.
In Afghanistan, where the economy has already hit rock bottom, a turnaround is seemingly far away as systemic disparity, unemployment, poor infrastructure, lack of welfare programs and public services, etc. continue to plague Afghans despite endless promises by politicians to “fix” the problems.
Hence, Blockchain and Crypto can allow citizens to take charge of their own lives and take part in a rewarding economic activity.
Linking Afghanistan With The World
Rob also believes that since Crypto is not restricted by boundaries, they can enable Afghans to be part of the global economy. The CBA chief supports this hypothesis where he adds that Digital Tokens are an avenue for locals to participate in international markets that have untapped economic opportunities.