Crypto’s use for humanitarian aid limited, US official says

A sign illustrating the transfer of dollars, yen and pounds to bitcoin in the window of at a Bitcoin Change bureau. Rosenberg said there are some instances where digital assets can help, but there are limitations that prevent it from having far-reaching effects. — Bloomberg

There are limits to how much digital assets can be used to provide humanitarian relief to countries in crisis, a US Treasury official said on April 22.

“I personally remain sceptical that digital assets will radically change the way the overall global financial system operates or transfers funds in a crisis – at least as they stand today,” said Elizabeth Rosenberg, assistant secretary for terrorist financing and financial crimes at the Treasury Department.

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“We should be realistic about the limits of digital assets and their utility for humanitarian efforts,” she said at an event in Washington held by the Institute of International Finance.

Rosenberg’s comments came after executives from companies at the event including Circle Internet Financial Limited, Coinbase Global Inc, and Ribbit Capital touted examples where digital assets have been a source of humanitarian aid. Ukraine, for instance, has raised more than US$100mil (RM432.50mil) in crypto donations that it’s put toward military equipment and other supplies as it tries to fend off Russia’s invasion.

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Roya Mahboob, an Afghan entrepreneur who is the co-founder and chief executive officer of the Digital Citizen Fund, said cryptocurrency “has provided a small but critical financial lifeline” for Afghan citizens as the country’s banking system nears collapse.

Rosenberg said there are some instances where digital assets can help, but there are limitations that prevent it from having far-reaching effects. Less developed nations like Afghanistan lack certain infrastructure, including reliable Internet connectivity and access to an economic system capable of processing cryptocurrency into necessary goods and services, she said.

“It’s hard to envision widespread use of digital assets to meet humanitarian needs,” she said. – Bloomberg

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