Distributed Ledger Technology (Blockchain) in the Financial Sector of Developing Economies: The Case of Afghanistan

Abstract

This article explores the transformative potential of Blockchain and distributed ledger technologies (DLT) in Afghanistan’s financial sector, amid a backdrop of systemic instability, infrastructural gaps, and geopolitical constraints. Drawing on an extensive review of digital banking development, expert interviews, and comparative global experiences, the study critically assesses Afghanistan's readiness to adopt Blockchain as a tool for financial inclusion, transparency, and institutional resilience. Although the formal banking system has largely regressed post-2021, grassroots crypto adoption reflects a latent readiness for decentralized solutions. The paper argues for a strategic, phased approach to Blockchain integration through regulatory reform, stakeholder engagement, and pilot implementations, particularly in land registration and remittance processing.