The Democratic Federation of Northern Syria (DFNS), commonly identified as Rojava, is looking to adopt cryptocurrency and blockchain technology in a bid to further its struggle for self-determination and sovereignty.
Rojava gained de facto autonomy from Syria in 2012 during the early stages of the Syrian Civil War when government forces withdrew from three areas that now form the DFNS. Although the autonomous region is not recognized by any international state or organization, it has been self-governing has been acknowledged by many.
The war continues to this day and tensions between Rojava and Syria remain high. This has resulted in economic sanctions on Rojava from its neighbors Syria, Turkey, Iraq and Iran. The cost of conducting international business is high due to these sanctions, especially as Rojava is using the Syrian pound (SYP), the fiat currency of a country which it has been at war with for years.
There is obvious discontent in Rojava that the SYP is operational, not least because of the cost of its fight for independence. A leader of Rojava’s Technological Development Program, Erselan Serdem, says, “We do not like to depend on the Syrian government money, which is state money, we want to trade our own cryptocurrency.”
Compounding the matter is SYP’s devaluation, from SYP 47 to a US dollar when the war broke out in 2011, to SYP 515 per USD as of 11 October 2018. Both Rojava and Syria have faced severe economic disruption due to this inflation. Rojava reportedly spends significant sums of money processing fiat currency and locals have to use large amounts of cash to secure trades.
A remedy in crypto
Amir Taaki, a Bitcoin developer who was famously involved in the Syrian Civil War, suggests that local currency exchanges be supplied with Bitcoin, and residents of Rojava be supplied with mobile phones and wallet software. He believes this would free them from using the constantly deflating SYP and provide a means to circumvent sanctions. Taaki says, “The cost of making a transaction with Istanbul is currently 10!. We believe that with cryptocurrency we can make this 2% globally, not just with Istanbul”.
Providing everyone with mobile phones might be overly ambitious, and Taaki suggests paper notes pegged to crypto might be an ideal solution. He says, “Not everybody has mobile phones, so we see research into paper currency as an important project.”
Aside from using Bitcoin as an overall national currency in Rojava, there is some potential for local cryptocurrencies to be developed. Rojava’s economy and society functions on cooperatives such as farming, healthcare, and media and arts. Taaki thinks local cryptos can be developed for these cooperatives, saying, “The cooperatives can trade with each other based on currencies that are pegged to a basket of goods, or just free floating in the market.”
Blockchain technology itself is also on Rojava’s radar, to create a transparent and secure democratic system. Serdem says, “With technologies like blockchain we can have a system, like a network, between all the communes we’re going to create in the future. With the base of the blockchain we can create a process of self administration. We can distribute all the roles in the society.”
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