Blog Post by Rebecca Thompson*

Some locations and names in this blog post have been changed to protect the identities of those in Syria.

Introduction

A low concrete building on the edge of Homs. Inside, families wait, some have been there for hours. There is no air conditioning, temperatures are reaching close to 40 degrees. Most people are holding worn documents in plastic sleeves; these are the few papers that survived displacement. There’s a quiet hum. A child sits cross-legged on the floor. Nearby, a woman scrolls through her phone, searching for a Wi-Fi signal strong enough to upload a photo of her ID. The electricity switches off in the room for the third time that morning; the internet stalls. 

At the front of the room, an officer works slowly through the queue. The software is outdated, the data patchy. Names are misspelled, dates of birth are approximated, and families try to make their documents fit a system that no longer reflects their lives. Outside, a man waits for a shared taxi to take him across town to file a property claim. His only savings – in dollars and Syrian pounds – are folded into his coat pocket, vulnerable to loss, theft, or suspicion. 

In these small, everyday interactions, the fragility of return becomes visible. The risks aren’t always dramatic, but they accumulate – a missed appointment, a lost document, a delay that costs a month’s income. The infrastructure of return is uneven and slow to rebuild. 

And yet, just beyond this scene, something else is emerging. 

A few streets away, in a dimly lit room above a shop, a group of young Syrians are working quietly on a blockchain-based payment system. It’s a modest project, built with limited resources but it has clear intent; to help people access money safely, pay for goods securely, and begin to participate in economic life on their own terms.

This is Syria in 2025; fractured, transitioning, uncertain, and yet, there is a quiet momentum building around alternative ways of doing things. Mobile phones are more common than bank accounts. Remittances flow through informal money transfer networks of trust. Digital tools, from crypto wallets to decentralised ledgers, are filling gaps left by formal institutions. Chimni (2009) argues that “return” in fragmented states must be rethought in ways that accommodate informal systems and digital infrastructure. Syria is evidence of how this is working in practice. These shifts challenge traditional durable solutions frameworks. They are reshaping what return and recovery might look like from the ground upwards.

From Fieldwork to Systems Thinking: Observations from Syria

Over the past year, I’ve spent extended periods of time in Syria in the capacity of a private sector consultant for an Afghan founded Fintech called HesabPay, funded by the Algorand Foundation (a layer-1 blockchain) which “aims to promote opportunity for everyone to harness the potential of an equitable and truly borderless economy”. One of my objectives in Syria has been to better understand how decentralised finance (DeFi) and cryptocurrency tools might support refugee return, recovery, and broader economic reintegration. My work has taken me to government offices in Damascus, emerging market hubs in Homs and Aleppo, and transitional spaces like Idleb and Deraa. While I cannot name all the actors involved due to political sensitivities, I can describe the systems, both formal and informal, that are quietly evolving outside the traditional aid architecture.

In Damascus, I was struck by the gap between high-level ambition and ground-level functionality. Conversations with Central Bank advisors and Syrian fintech entrepreneurs revealed a growing awareness of blockchain’s potential. Some government actors under the transitional presidency of Ahmad al-Sharaa expressed interest in digital payment systems as a way to stabilise return areas while state institutions catch up. However, the formal banking sector remains deeply constrained. Ongoing international sanctions as well as the international corresponding banks’ hesitancy to reengage with a context perceived as having high money laundering and terrorist financing risks are felt deeply.

Meanwhile, in Idleb, which was long governed by hybrid authorities including the historically designated Foreign Terrorist Organisation (FTO) Hay’at Tahrir al-Sham (HTS), I encountered a parallel financial system already in motion. Returnees were receiving remittances via mobile wallets linked to stablecoins. Informal vendors were accepting digital payments. Community organisers were discussing using blockchain-enabled registries to document land use and property claims in areas where cadastral records were destroyed or never existed. It was not perfect, but it was functioning.

These on-the-ground experiences shaped a growing understanding for me: digital currency tools, when embedded within protection frameworks and localised design, have the potential to strengthen the possibilities of durable solutions in meaningful ways. These reflections build on evaluation work in the humanitarian sector on blockchain solutions from agencies like the Norwegian Refugee Council (NRC, 2023), who have documented the opportunities of community-led blockchain initiatives in fragile settings. Werner et al. (2021) also show how DeFi’s modularity supports rapid adaptation where state infrastructure is weak.

A System Under Strain: Aid, Funding Cuts, and the Case for Change

The context for understanding this shift to local digital solutions is urgent. Humanitarian financing is in crisis. The Trump administration’s defunding of major multilateral organisations – including UNRWA, UNHCR, and other parts of the UN system – has deepened an already severe resource gap across the Middle East. In Syria, the result has been more than a budget shortfall. It has meant the erosion of long-standing models of engagement. Coordination mechanisms have frayed. Agencies are being forced to rethink everything, from delivery systems to institutional roles. At the same time, donor risk aversion has grown, particularly around financial transactions in sanctioned settings. This has led to a paradox; those most in need of flexible, inclusive financial systems are often those least served by traditional tools. Banks won’t open accounts. Mobile money systems don’t function across borders. Cash distribution networks are subject to coercion or co-option by armed actors.

DeFi and stablecoin systems offer an alternative. This is not a replacement, but a new layer. One that is decentralised, programmable, traceable and more cost effective. In my recent work on the design of stablecoin-based aid disbursement systems for HesabPay in Syria, I have argued that programmable cash flows – linked to biometric ID or digital vouchers – could help ensure compliance while expanding access (Unpublished: Thompson, 2025). I have also argued that these systems can also offer auditability for donors and greater autonomy for recipients. Importantly, precedent suggests, that when layered properly, Defi and stablecoin systems don’t displace humanitarian protection, they reinforce it. The 2022 UNHCR-Stellar pilot in Ukraine delivered USDC to refugees via blockchain wallets, redeemable through MoneyGram, with compliance assured through off-chain KYC (UNHCR 2022; 2023). This pilot offers a real-world template for what’s now technically and institutionally possible.

Durable Solutions, Revisited

The idea that return is a process, and not an event, has been central to durable solutions literature for years. The classic formulation focuses on three dimensions: legal status, physical safety, and economic reintegration. Yet in practice, the economic component has often been the weakest link, especially in Syria where formal markets remain distorted and predatory.

Recent scholarship argues for more flexible models that account for political fragmentation and contested sovereignty. Aquilina, Frost, and Schrimpf (2024) note that effective DeFi deployment in fragile contexts requires tailored regulation, but also offers autonomy and speed that traditional actors often cannot match.  Durable solutions, they argue, should be grounded in mobility, autonomy, and localisation – not just state-led restitution. My experience echoes this. In many parts of Syria, the question is no longer “how do we rebuild the state?” but “what systems can we put in place now to enable people to live, move, and rebuild?”

DeFi systems – whether stablecoins for aid, crypto-enabled remittances, or decentralised ID and property records – provide one such system. They operate outside of centralised choke points. They enable direct transfers. They are, in many cases, more functional than the alternatives. And they align with what Syrians themselves consistently express; the need for financial dignity, autonomy, and inclusion.

Implementation Pathways: From Theory to Practice

What would this look like in practice? From my fieldwork and programme design experience, I would suggest four core areas where decentralised finance can contribute to durable solutions for returnees in Syria:

1. Crypto-Enabled Social Assistance: Returnees could receive basic income support via dollar-pegged stablecoins stored in mobile wallets. These could be programmed for restricted use (e.g. food, rent) and monitored through open blockchain ledgers for compliance.
2. Digital HLP Records: Using blockchain to create timestamped, tamper-proof records of land ownership, use and occupancy could support informal tenure recognition — a key issue for returnees who cannot always access the formal courts or cadastre (which themselves are in transition).
3. Diaspora Remittance Integration: Matching programmes could be designed so that remittances sent in stablecoins are topped up by donor funding or linked to incentives for returnee families. This would formalise an existing practice and make it safer.
4. Localised Financial Infrastructure: Partnering with Syrian-led fintech start-ups to design, test, and scale DeFi tools ensures systems are fit-for-context. Supporting the Syrian transitional government by providing international technical expertise to speed up their own digitalisation plans for the economy so that it can interact with the international economic system. This requires not only funding but trust — and a shift in mindset from aid actors.

These models are already being piloted quietly in parts of Syria. Mercy Corps Ventures (2025) have recently published their evaluation work on their pilot to provide farmers with stablecoin in North East Syria, through HesabPay. Yet whilst the evidence base for DeFi is growing, what is missing is institutional endorsement, donor resourcing, and regulatory clarity.

Risk, Compliance, and the Role of the Private Sector

Of course, the use of crypto in humanitarian settings raises concerns. Volatility, fraud, money laundering, and sanctions violations must all be taken seriously; but these are not new risks, they are simply reframed. I would argue that the question is not whether risk exists, but how it is distributed and managed.

From my experience with working on platforms like HesabPay (built on the Algorand blockchain) – which integrates off-chain KYC, smart contract transparency, and sanctions-compliant design – I’ve seen how risk can be reduced without closing off innovation. Crypto need not mean anonymity or deregulation. In fact, in high-risk environments, it may offer greater traceability than cash. There is much evidence to draw upon from the private sector. Bluhm et al. (2024) demonstrate how programmatic stablecoin models using automated asset-liability dashboards can provide real-time liquidity and compliance metrics.

Indeed, the private sector could have a key role to play in contexts like Syria, not as a contractor, but as a partner. Syrian fintech firms understand the terrain. Many have diaspora links, technical capacity, and agility that traditional actors lack. Humanitarian actors should move beyond “vendor” models and consider investing in co-designed systems that embed humanitarian values from the start. Stabilisation and development actors should work with the humanitarian sector on a truly structural overhaul to their approach.

Conclusion: Courage and Imagination

Last month in Damascus, I sat in a room with a group of Syrian developers working with colleagues online in Afghanistan on building a decentralised wallet for refugee returnees. Their goal was modest; help people access money without going through ten checkpoints, five intermediaries and losing up to 7-10% in transfer fees. Yet what struck me wasn’t just the ingenuity, it was the patience. They were not waiting for international validation. They were building because people needed tools now. This is the future of return. It is slow, experimental, decentralised, and often invisible to the formal system, but it is no less real.

The durable solutions agenda must evolve. Not just in its technical design, but in its assumptions about what counts as legitimate infrastructure. Crypto and DeFi are not panaceas, but in the absence of functioning state systems, and amidst a global aid retreat, they may be among the few tools that offer both dignity and delivery.

To contribute to this conversation or pitch an essay for the series on the Availability of Durable Solutions for Syrian Refugees please reach out to the editors: Dr Shaddin Almasri (shaddin.almasri@donau-uni.ac.at), Dr Jasmin Lilian Diab (jasminlilian.diab@lau.edu.lb), and Dr Nicholas Maple (nicholas.maple@sas.ac.uk).

*Rebecca Thompson is a humanitarian and stabilisation policy advisor and research fellow at the Refugee Law Initiative (RLI), University of London. She is also a research grant recipient through the British Academy and Carnegie Global (Dis)Order programme, as well as a rostered stand-by Deployable Civilian Expert (DCE) for the UK Foreign Commonwealth and Development Office (FCDO), through the UK funded Humanitarian, Stabilisation and Operations Team (HSOT) and Civilian Stabilisation Group (CSG). With close to two decades of experience in conflict and displacement contexts, she works at the intersection of humanitarian response, stabilisation, and international politics in fragile and conflict affected states. Rebecca is especially interested in rethinking the distribution of power in humanitarianism and the aid security nexus at large, as well as in shaping future models of international engagement. She is currently on consultancy with private sector actors HesabPay and the Algorand Foundation (a layer-1 blockchain) exploring how decentralised finance and private sector partnership can support Syrian refugee returns, as well as broader economic recovery.

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