Cryptocurrencies: Risks of conflict and opportunities for peace
Our research shows the impact of digital currencies in places affected by violence and political instability.
Cryptocurrency use has increased dramatically in recent years. In conflict-affected areas, digital currencies continue to grow in popularity, and more than half of the countries in the top ten cryptocurrency users list are conflict-affected. Many people are buying, selling and mining on the crypto market, including men, women, and young and older people in urban and rural areas.
Cryptocurrencies can offer a rare way to make money and take steps out of poverty through new business and investment opportunities in places where access to the global economy is complex. For some people, it means cheaper and faster international payments using global exchange rates outside of government-controlled systems that would not usually be an option. Cryptocurrencies can also generate income during times of rising unemployment and bring money into local communities through access to the global job market.
However, despite its many benefits, there are significant safety and security risks. Governments make quick and variable changes in the status of cryptocurrencies, leading to tensions and fear around the safe use of apps and equipment. The lucrative nature of the work means people are willing to take considerable financial risks to set themselves up in cryptomining, but they can’t always repay the loans. There is also the chance of getting caught by scammers who exploit people with limited financial knowledge and experience.
Read our research brief to learn more about the opportunities and challenges of digital currencies in three conflict contexts.