Afghanistan

Following the Taliban's return to power in 2021, a brief period of regulatory ambiguity allowed cryptocurrency adoption to surge as citizens sought to preserve wealth amidst a collapsing banking system and international sanctions. However, this 'gray zone' period ended abruptly in August 2022 when Da Afghanistan Bank (DAB) imposed an absolute ban on all cryptocurrency activities. The central bank's directive was driven by a strict interpretation of Sharia law, which categorized digital assets as 'haram' (forbidden) due to elements of gambling ('maisir') and uncertainty ('gharar').

The enforcement of this ban has been notably physical and severe. The regime has focused its crackdown on Herat, a western province that had emerged as a hub for crypto brokerages due to its proximity to the Iranian border. In August 2022, security forces shut down at least 16 cryptocurrency exchange businesses in Herat and arrested 13 individuals. This was not a one-time event; enforcement actions have continued into 2024. For instance, in May 2024, reports surfaced of eight crypto traders being arrested and imprisoned for nearly a month, highlighting the sustained risk for any retail participants.

The legal framework supporting this ban is not a traditional parliamentary act but rather a combination of central bank circulars and religious decrees which carry the force of law under the Islamic Emirate. In April 2024, the DAB issued a fresh warning specifically targeting online currency exchanges, reiterating that no licenses exist for such activities and that violators would face prosecution. This effectively closes off any potential loophole for regulated trading.

Despite the draconian measures, underground peer-to-peer (P2P) trading reportedly persists as a desperate measure for remittances and capital flight. However, the risks are extreme: traders face not only the confiscation of assets but also imprisonment. The regulatory environment is characterized by zero tolerance, with the central bank explicitly aiming to eliminate 'fraudulent' digital currencies to protect the national currency and ensure full compliance with Islamic financial principles.