The US government is planning to use $7bn (£5.16bn) in frozen Afghan assets to compensate victims of the 9/11 attacks and for relief efforts.
Washington froze the money after the Taliban took power last year but has been under pressure to find a way to use it without aiding the militants.
A Taliban spokesman condemned the move, calling it "theft" and a sign of "moral decay".
The move came in an executive order declaring a national emergency.
As for the funds,
President Biden's order formally blocks them, and says US financial institutions should transfer them to a consolidated account at the Federal Reserve.
The money, along with another $2bn held in Europe, the UAE and elsewhere, is primarily the proceeds of international assistance given to Afghanistan over the last two decades.
On Friday, a senior administration official said that a third-party $3.5bn trust fund would be set up to ensure that the money addresses the immediate humanitarian needs of the Afghan people, while at the same time "ensuring no benefit goes directly to the Taliban".
"We've not made specific decisions about how the funds will be used," the official said, adding that it would be months before the money was available, pending a judicial decision.