Afghanistan becomes a fertile ground for crypto innovation: rewriting the world of conflict and humanitarian aid

The Taliban regime maintains a high level of vigilance over the internet, but a new Afghan startup is developing blockchain tools that could revolutionize the way humanitarian aid is distributed in conflict zones. This article is based on an in-depth report from The New York Times, translated by Dynamic Zone.

(Background: The UN plans to create a “Decentralized Digital Identity (DID)” using ZK zero-knowledge proofs to protect refugees’ safety)

(Additional background: “Sending Love on the Chain” — Binance Charity Joint Blockchain Enthusiasts Association donated over NT$3.5 million to support Hualien reconstruction)

In a crowded currency exchange office in northwest Syria, 46-year-old farmer Hala Mahmoud Almahmoud tightly holds a plastic card, as if clutching her lifeline. She has never interacted with cryptocurrency before, but the $500 digital assets stored on this card will help her restart her farm after nearly 14 years of civil war.

When the teller verifies the amount and hands her cash, Hala Mahmoud Almahmoud breathes a sigh of relief, smiles, and softly thanks them. She can’t help but ask where this technology originated.

The answer surprises her: Afghanistan.

In this country known for the conservative rule of the Taliban, the authorities are highly suspicious of the internet, making it hard to imagine that such cutting-edge blockchain transfer technology could emerge here. Yet, in this almost isolated country, an Afghan startup is actively developing various tools, hoping to transform the way humanitarian aid is delivered in war-torn regions.

“We have personally experienced these difficult circumstances, so we know how to build practical and effective solutions,” said 26-year-old Zakia Hussaini, a programmer at the startup HesabPay. It is the technology developed by her company that supports the card that changed Almahmoud’s fate.

Syria near Latamina, Hala Mahmoud Almahmoud stands outside her home. She received $500 in cryptocurrency aid to restart her farm.

The UN Refugee Agency is an early supporter of this platform, using HesabPay to assist over 86,000 families inside Afghanistan. This is one of the world’s largest public blockchain aid projects. The organization providing funds to Almahmoud, Mercy Corps, is also collaborating with HesabPay to extend the platform’s services to Syria, with plans for aid programs in Sudan and Haiti underway.

In Syria, obtaining funds from abroad is extremely difficult: local cash is scarce, international banks are wary of the country, and remittance services like Western Union can charge up to 10% in transfer fees. HesabPay helps organizations like Mercy Corps bypass these obstacles.

The founder of HesabPay is Sanzar Kakar, an Afghan-American entrepreneur who previously managed Afghanistan’s largest payroll processing company. After the U.S. military withdrew from Afghanistan and the Taliban regained control in 2021, the financial system collapsed: international sanctions cut off all cross-border transfers, and the central bank system disintegrated.

To address the worsening financial security crisis at home, Sanzar Kakar turned to blockchain technology. He developed the mobile app HesabPay, named after the local Afghan word for “account,” supporting real-time transfers between digital wallets without the need for banks or Taliban government intervention. He states that the Afghan government has issued a license to the company, allowing it to operate officially as a financial institution.

Aid organization Mercy Corps collaborates with HesabPay to expand the platform’s coverage to Syria.

Currently, the platform has accumulated over 650,000 digital wallets in Afghanistan, with about 50,000 actively used daily, facilitating approximately $60 million in monthly fund flows through stablecoins backed by Afghan Afghani.

Carmen Hett, the UN Refugee Agency’s Chief Financial Officer, revealed that since February 2025, the UN has used HesabPay to distribute nearly $25 million in aid to 80,000 vulnerable Afghan returnees’ digital wallets. “This model significantly reduces transaction fees, shortens the time for funds to reach recipients, and enhances traceability, real-time monitoring, and accountability.”

Ric Shreves, an expert in decentralized finance solutions and chairman of the Decentralized Cooperative Foundation, said that it is not surprising that organizations like Mercy Corps and the UN choose blockchain transfers for aid work. “Compared to traditional aid distribution methods, this model offers almost all advantages.”

However, he also pointed out that this system still carries risks, especially in countries like Afghanistan that use local currency-backed stablecoins (Syria’s HesabPay wallets are backed by USD stablecoins, which are more stable). Digital wallets could be frozen if transactions involve sanctioned individuals, and in theory, central banks could freeze wallets based on political reasons.

Mercy Corps successfully delivers aid to Syria using blockchain technology, where cash is scarce and most international banks do not operate.

“We provide non-physical transaction methods, which also means these transactions could be cut off by technical means,” said Ric Shreves. He added that while digital currencies are much safer than cash, they cannot be hidden under a mattress like cash.

In recent years, aid organizations have increasingly preferred cash aid, which is efficient and preserves the dignity of recipients. But cash has a fatal weakness: it is hard to trace. Donors want proof that funds actually reach those in need. Since President Trump drastically cut U.S. foreign aid funding early last year, organizations like Mercy Corps face greater pressure to demonstrate the effectiveness and compliance of their aid efforts.

Blockchain technology can solve this problem: it generates clear digital trails, accurately recording the amount of funds distributed, the recipients, and the flow of usage. Scott Onder, Chief Investment Officer of Mercy Corps, said that this efficient and accountable model “may help regain the trust of skeptics about aid work.”

HesabPay also features additional security measures, such as real-time data dashboards that track wallet transactions and cross-check against international compliance databases. The company states that this system can identify illegal activities like terrorism financing, money laundering, and cyber fraud. When suspicious transactions are detected, alerts are immediately issued. For aid donors, this provides a level of regulation that is difficult to achieve in fragile countries.

A resident of Hafaia, Abdul Moti Hammoud, lost a leg after accidentally triggering a landmine while driving a tractor. He is also a beneficiary of Mercy Corps aid programs.

In a recent online demonstration, Nigel Pont, senior humanitarian advisor at the company, clicked on a purple dot representing an Afghan HesabPay agent. Dozens of light blue wallet icons representing aid recipients appeared, showing recent transfer records; clicking again revealed subsequent fund flows. During the demonstration, one wallet suddenly flashed a red warning for potential fraud. Although the live broadcast was somewhat awkward, it proved the system’s risk detection capability.

Nigel Pont, a former Chief Strategy Officer at Mercy Corps, said, “From the perspective of aid donors, the value of this feature is hard to quantify. A system that automatically flags fraud risks allows us to conduct immediate investigations, rather than discovering after six months that $20,000 in aid has been misappropriated.” He admitted that no system can completely eliminate corruption, and cash aid is no exception.

22-year-old Abdul Halim Hasan, queuing with Almahmoud at a currency exchange in Syria, said he hopes one day to use HesabPay as a regular bank account to safely receive, pay, and save money. But for now, this HesabPay card provides him with the funds needed to rebuild his life after the war, and that is enough.

“I sincerely hope this method can be popularized in Syria,” he said.