ATMs Run Out of Money in Afghanistan as Taliban Occupies Major Cities

Afghanistan is under siege by the Taliban and with the president fleeing the capital, the state has fallen to the self-proclaimed Islamic Emirate of Afghanistan.

With many trying to flee the country, the frantic search for cash has led to banks and ATMs running empty.

According to reports by Al Jazeera and other news services, Taliban forces started capturing cities inside Afghanistan over the past week and have since taken Kabul, the nation’s capital.

More recent reports indicate that flights to Kabul have been re-routed and those to nearby provinces, Herat and Kandahar, have been cancelled.

When the news broke, Afghans and foreigners alike flocked to the airport seeking a way out, trying desperately to get their hands on money for supplies and flight tickets.

“The ATMs were all out of money, [and] the banks were full of hundreds of people lining up trying to take out as much money as they could,” said Afghani citizen Abdul Wahab, who was in Mazar on a business trip. The liquidity crisis has had serious repercussions for people who need some form of money to survive.

A similar situation occurred in Lebanon in 2019 where ATMs ran out of cash and banks capped withdrawals.

Blockchain Solutions to Broken Infrastructure

During crises like these, the internet can be suspended in a country cut off from the rest of the world, or provided solely to critical institutions. In a case such as that unfolding in Afghanistan, the military can stop routing traffic outside the country, making it nearly impossible to enact a bank transfer or any kind of transaction.

Even without internet access, however, people inside the country can still use peer-to-peer infrastructure or other bandwidths to transact if they have wallets on their phones containing crypto. The actual bitcoin balances are stored on the blockchain “public ledger”, which is constantly being updated by the bitcoin network even when holders are offline.

According to Richard Myers, a decentralised applications engineer at Global Mesh Labs, “In many parts of the rural and developing world, internet connectivity is both expensive and intermittent. Bitcoin transactions can be made over alternative low-bandwidth transport layers like mesh radios and SMS.”

The deployment of mesh networks and long-range radios can act as a substitute for internet connectivity. Using SMS bridges or meshnets, users can broadcast transactions throughout the network, without requiring an internet connection.

As in the current situation in Afghanistan and other countries in the world with infrastructure problems, blockchain and cryptocurrency are a solution to transact when the internet goes down, but when the power goes out that’s a different story.