The Pakistani government has set up three sub-committees to deliberate the future of cryptocurrency in the nation. The committees will assess all elements of the cryptocurrency industry and offer recommendations on Pakistan’s crypto legislation.
Pakistan forms panels to decide on whether to regulate or ban crypto
According to government records provided to The Express Tribune, Pakistan’s federal government is moving towards shutting down or controlling the cryptocurrency market. These subcommittees were established during a meeting chaired by Finance Secretary Hamed Yaqoob Sheikh.
These panels will develop their suggestions based on everything about the cryptocurrency industry, including its legal status and a prohibition on it. The recommendations will be delivered to a committee chaired by the finance secretary.
The foundation of the first panel was laid under the chairmanship of Pakistan’s legal secretary. Among other members, the State Bank of Pakistan (SBP), Federal Investigation Agency (FIA), and Pakistan Telecommunication Authority (PTA) will be present.
The committee will consider whether cryptocurrencies may be banned under current regulations. It will also suggest a method for banning crypto while preserving a delicate balance between protection and technological progress.
The remaining two sub-committees have been presided over by SBP Deputy Governor Saima Kamal. The committees will include representatives of the Ministry of Information Technology, Securities and Exchange Commission of Pakistan, the PTA, and others.
The report will also convey their thoughts on imposing an immediate ban on cryptocurrency and the consequences it may have in the future. They’ll also debate whether the nation would fall behind other nations if cryptocurrency gets banned in the country.
Following that, the sub-committees will develop their proposals and submit them to a committee headed by the finance secretary, after which policy options on cryptocurrencies will be created.
The crypto environment in the Islamic republic
In the Islamic republic, the legality of cryptocurrencies has been a topic of debate for some time. Many cryptocurrency experts have claimed that controlling crypto use is essential for nations such as Pakistan, which are attempting to combat criminal activities like money laundering and terrorist financing.
In January, the Federal Investigation Agency (FIA) reportedly requested that Pakistan’s Telecommunication Authority block over 1,600 cryptocurrency websites. The committee’s debate will significantly influence Pakistani citizens who have heavily invested in cryptocurrency.
The State Bank of Pakistan has long opposed cryptocurrency. In March, SBP Governor Reza Baqir stated that there are numerous abuses [of cryptocurrency], including human rights abuses, trafficking of humans, money laundering, and other nefarious activities. In February, the governor acknowledged that crypto’s risks “far outweigh the benefits.”
However, despite official warnings, crypto adoption in the country has reached new heights. According to Cryptopolitan, Pakistan`s citizens have more cryptocurrency assets than their country’s foreign reserves. These people have amassed their riches as a result of the absence of a framework for cryptocurrency regulation.
According to a Chinalysis report, Pakistan ranks third in the world when it comes to crypto adoption. Due to an increase in interest from investors towards major coins like BTC, the country experienced a staggering 711% growth over the last year. Now, it comes third, following behind India and Vietnam.
As crypto adoption grows, so does the demand for regulating these assets. Pakistan’s FPCCI boss has called on the government to regulate cryptocurrencies in order to preserve their value and prevent money laundering. When it comes to creating those regulations, he wants the government to adhere to acceptable organizations like the IMF’s standards.
Furthermore, the country`s biggest bank, Bank Alfalah, has asked its customers in the country to avoid trading cryptocurrencies via its systems. It is difficult to predict where the cryptocurrency market in Pakistan will go at this time.
In January, the federal government and its central bank filed a petition with a provincial court asking that the government bans cryptocurrencies. The results are left to be seen, however, the government can benefit from regulating cryptocurrencies by gaining access to data on cryptocurrency transactions. Government entities can utilize the data to detect money laundering and other illegal activities and provide a framework for resolving issues that may arise over cryptocurrencies.