Afghanistan Turns To Bitcoin To Boost Economy

Afghanistan is looking to boost its ailing economy with bitcoin.

At the annual Spring Meetings of the Boards of Governors of the World Bank Group and the International Monetary Fund in Washington, Khalil Sediq, governor at the Central Bank of Afghanistan, told The Asia Times that Afghanistan might issue a sovereign crypto bond that uses blockchain technology. The goal is to raise $5.8 billion to support the country’s critical mining, energy and agriculture sectors.

Afghanistan has been in economic turmoil for the last three decades, with the country’s 25-percent population currently unemployed and living under the poverty level.

Sediq explained that bitcoin could be used with a form of metals future, such as lithium, adding that the value of Afghanistan’s mineral reserves is estimated at more than $3 trillion. In fact, the country is expected to be one of the world’s largest miners of lithium, which is in short supply due to the high demand for electric vehicles.

Christine Lagarde, the managing director at the IMF, said that while she supports Afghanistan’s bitcoin ambitions, she believes that bond issuance over blockchain should be tested in a sandbox environment before it is formally implemented.

In the meantime, Afghanistan isn’t the only country looking into bitcoin. Tunisia has formed a working group that is studying the issuance of a sovereign bitcoin bond. Banque Centrale de Tunisie governor Marouane El Abassi told delegates at the Spring Meetings that his country was already hosting digital cash payments through a Poste Tunisienne system created by DigitUS Tech.

And Uzbekistan sent a delegation to the event so it could study bitcoin and blockchain. Uzbek Ambassador to the United States Javlon Vakhabov told delegates that an Uzbek bitcoin bond could be coupled with the cotton futures market, as the Central Asian nation is the world’s fifth-largest producer of the commodity.