Taliban release arrested crypto exchange owners.
Crypto remains banned in Afghanistan.
Some crypto traders arrested and detained by the Taliban have been released after almost a week, but the Taliban have banned digital assets nationwide, claiming scams and fraud as the reason.
16 local crypto exchanges in Herat were raided by Taliban forces on August 14, 2022. The traders were arrested and forced to close their businesses.
“Although the traders have been released, they have been banned from making any crypto-related transactions”, said the CEO of one of the local exchanges, who would prefer to stay anonymous due to security reasons.
The CEO then stated that there was no warning prior to the ban or the arrests of the traders. They were first arrested and then told that they cannot continue their operations in the country.
On the other hand, some local reports state that the ban was imposed three months ago by the Taliban and, according to Sayed Shah Saadat, head of the counter-crime unit of the Herat police, Da Afghanistan Bank asked for measures against the crypto businesses as there were frauds and people were being scammed. The Taliban then decided to act and to close these exchanges.
Although there were rumors that Taliban forces seized the crypto holdings of the arrested crypto traders, this was denied by the CEO, who asked to remain anonymous.
Herat, Afghanistan’s third-biggest province, reportedly hosts four of the six reputable Afghan crypto exchanges.
Although the ban was declared nationwide, local crypto exchanges are currently operating in other provinces of Afghanistan, according to an employee of a local crypto exchange in Kabul.
Nonetheless, it was no surprise to most of the crypto exchange owners, as they were expecting the Taliban to consider crypto assets as ‘haram’ (non-compliant with Sharia law). Sayed, CEO and founder of a crypto exchange in Kabul, said they had already tried to go undercover last October.
He added that even though it was accepted as ‘halal’ by some scholars, the Taliban would still refuse to accept such commentaries.
Under Islamic Sharia law, things with actual value can be bought and sold. Hence some scholars might say that cryptocurrencies can be ‘halal’ if we consider them as assets with their own value.
We should also mention that the Taliban did not share their opinion as to whether cryptocurrencies are compliant with Islam or not. The reasons they gave for banning them were fraud and scams.
In Afghanistan, crypto exchanges use the Peer-To-Peer (P2P) model, which means anyone who wants to trade crypto has to be there in person and use cash for their transactions. No third parties are used in the trading activities.
Afghanistan is ranked 20th out of 154 countries in terms of crypto adoption, according to the Global Crypto Adoption Index in 2021.
Sources: cryptonews.com
analyst opinion
Eda Tutkun
Some crypto traders arrested and detained by the Taliban have been released after almost a week, but the Taliban have banned digital assets nationwide, claiming scams and fraud as the reason.
16 local crypto exchanges in Herat were raided by Taliban forces on August 14, 2022. The traders were arrested and forced to close their businesses.
“Although the traders have been released, they have been banned from making any crypto-related transactions”, said the CEO of one of the local exchanges, who would prefer to stay anonymous due to security reasons.
The CEO then stated that there was no warning prior to the ban or the arrests of the traders. They were first arrested and then told that they cannot continue their operations in the country.
On the other hand, some local reports state that the ban was imposed three months ago by the Taliban and, according to Sayed Shah Saadat, head of the counter-crime unit of the Herat police, Da Afghanistan Bank asked for measures against the crypto businesses as there were frauds and people were being scammed. The Taliban then decided to act and to close these exchanges.
Although there were rumors that Taliban forces seized the crypto holdings of the arrested crypto traders, this was denied by the CEO, who asked to remain anonymous.
Herat, Afghanistan’s third-biggest province, reportedly hosts four of the six reputable Afghan crypto exchanges.
Although the ban was declared nationwide, local crypto exchanges are currently operating in other provinces of Afghanistan, according to an employee of a local crypto exchange in Kabul.
Nonetheless, it was no surprise to most of the crypto exchange owners, as they were expecting the Taliban to consider crypto assets as ‘haram’ (non-compliant with Sharia law). Sayed, CEO and founder of a crypto exchange in Kabul, said they had already tried to go undercover last October.
He added that even though it was accepted as ‘halal’ by some scholars, the Taliban would still refuse to accept such commentaries.
Under Islamic Sharia law, things with actual value can be bought and sold. Hence some scholars might say that cryptocurrencies can be ‘halal’ if we consider them as assets with their own value.
We should also mention that the Taliban did not share their opinion as to whether cryptocurrencies are compliant with Islam or not. The reasons they gave for banning them were fraud and scams.
In Afghanistan, crypto exchanges use the Peer-To-Peer (P2P) model, which means anyone who wants to trade crypto has to be there in person and use cash for their transactions. No third parties are used in the trading activities.
Afghanistan is ranked 20th out of 154 countries in terms of crypto adoption, according to the Global Crypto Adoption Index in 2021.
Sources: cryptonews.com
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