Categories: Bitcoin Business

Afghanistan: A War-Torn Nation Hopes to Revive its Economy with Bitcoin

Click here to view original web page at www.ccn.com
War-ravaged Afghanistan is reportedly looking to issue a sovereign bitcoin bond. | Source: Shutterstock

By CCN.com: A war-torn country left to dust and drabbles is attempting to rise back with dignity. And it plans to use bitcoin as its stick.

Afghanistan asserted at a recent Spring Meetings summit that it was looking to issue sovereign bonds to raise $5.8 billion for its infrastructure projects. Khalil Sediq, the governor of the Central Bank of Afghanistan, told Asia Times that it would attempt to couple bitcoin with its mostly untapped, $3 million worth Lithium market. The outcome would be a digitally signed government bond that could be issued to investors over the blockchain.

Bitcoin against Three Decades of Turmoil

The announcement followed Afghanistan’s economic turmoil for the last three decades. It started with a political coup in the 1970s that led to the assassination of then-president Mohammed Dauod Khan. The tensions made way for the Soviet Union to invade Afghanistan. By the late 1980s, the country had become victim to the power struggles between the Soviets and the US.

When the Soviets lost in 1989, the US left Afghanistan in the hands of its then-allies, the Taliban. The Wahabbi Islamist group left no stone unturned to push the nation to the stone age. They later became the mastermind behind the shocking September 11 attacks in the US. That prompted Washington to launch one of its longest wars against the Taliban in an already-shredded Afghanistan. The conflict is now in its eighteenth year.

Such constant turmoils robbed the country of its potential economic opportunities. Afghanistan’s GDP fell substantially during the 1980s owing to the loss of capital, labor, infrastructure, trade, and transport. The nation’s 25-percent population is now unemployed and lives under poverty.

The International Monetary Fund (IMF) wrote in an analysis, published November 21, 2017, that Afghanistan’s external debt was at high risks. The report revealed that the country’s debt sustainability largely hinged on donor grants’ inflows – which was 39-percent of the total GDP – against substantial fiscal and external deficits. It read:

“Even a gradual replacement of donor grants with loan financing (a customized illustrative scenario) would quickly lead to an unsustainable debt burden.”

As a result, the World Bank imposed severe restrictions on Afghanistan’s non-concessionary borrowing – loans offered below a typical interest rate. The move left the nation highly insufficient to begin or to sustain its mining and agricultural projects.

Hopes

Sediq believed that bitcoin – an innovative financial instrument – could offer his country a way to access international markets. The economist reasserted that there was a massive demand for Lithium in the global market because of companies like Tesla and others. With bitcoin, said Sediq, Afganistan could allow the global investors to tap the potential of its abundant mineral reserves.

Christine Lagarde, the managing director at the IMF, supported Afghanistan on their move but suggested that bond issuance over blockchain should first go through a sandbox testing environment.

cinerama

Illuminati, Mason, Anonymous I'll never tell. I can tell you this, global power is shifting and those who have the new intelligence are working to acquire this new force. You matter naught except to yourself, therefore prepare for the least expected and make your place in the new world order.

Disqus Comments Loading...
Share
Published by
cinerama

Recent Posts

  • Bitcoin Business

Robinhood App Encroaches on Banking Turf with High-Yield Money Tool

Popular stock market and crypto trading app Robinhood is going after legacy banks with the relaunch of a cash management… Read More

2 hours ago
  • Bitcoin Business

The blockchain/crypto week in quotes

“The world that Satoshi Nakamoto, author of the Bitcoin whitepaper envisioned, and others are building, is an unstoppable force.” US… Read More

2 hours ago
  • Bitcoin Business

Art and watch collectors: Here’s how blockchain can stamp out fakes

According to an OECD report on counterfeiting, the world trade in fake goods is worth upwards of S$624 billion a… Read More

2 hours ago
  • Bitcoin Business

Litecoin and the Miami Dolphins Join Hands Over Charity

Who would have known American football and cryptocurrency would go so well together? In a press release, The Miami Dolphins… Read More

8 hours ago
  • Bitcoin Business

Crypto News: Grayscale’s Record Inflows, Shell’s New Blockchain Investment

Increasing amounts of capital are flowing into the crypto and blockchain start-up markets. By following the money, investors can uncover… Read More

8 hours ago
  • Bitcoin Business

David Koepsell (YICB 07), Co-founder of Encrypgen, LLC and Blockchain in Healthcare Global

David Koepsell is the co-founder and chief executive officer of Encrypgen, a software company creating next-generation blockchain solutions for genomic… Read More

8 hours ago

This website uses cookies. We use these cookies to collect data about your interaction with our website for the purpose of continuously improving your experience with our site. For more information we encourage you to read our privacy policy.

Read More