Pakistan’s Minister of State for Parliamentary Affairs, Ali Muhammad Khan, stated that the government has no objections to Pakistani youth using cryptocurrencies.
On October 20, 2021, the lower house of Pakistan’s parliament emphasized the lack of a regulatory framework for cryptocurrency. As a result, the Minister of State for Parliamentary Affairs was prompted to reaffirm the government’s position.
On the same day, the Sindh High Court urged the Islamabad government to establish a regulatory framework. The court has also formed a committee to study cryptocurrency, which will be chaired by the finance secretary. It anticipates receiving a report from the committee within the next three months.
Until recently, the Pakistani government’s lax approach to cryptocurrency regulation drew the attention of the Financial Action Task Force, a global money-laundering watchdog. This is due to the possibility of unchecked money laundering and terrorism financing.
In 2018, Pakistan’s central bank prohibited the use of cryptocurrencies. It stated that bitcoin, pakcoin, onecoin, and initial coin offerings tokens were not legal tender. As a result, the prohibition was broad. It prohibited any entity or individual from purchasing, issuing, selling, or exchanging digital currency.
Pakistani courts have been useful.
Pakistan’s courts have played an important role in pushing cryptocurrency adoption forward. Following the ban in 2018, a petition was circulated and brought to the court’s attention.
It responded by urging the Securities and Exchange Commission of Pakistan (SECP), the central bank (SBP), the Ministries of Law and Justice, and Information Technology and Communication to consult on a potential crypto regulatory framework.
Another crypto-related case heard by the Lahore High Court enlisted the assistance of the SECP, SBP, the Federal Investigation Agency, and the federal government, who were asked to present relevant legal positions.
The role of social media in cryptocurrency promotion
Despite perplexing regulatory moves, social media is to blame for Pakistan’s growing interest in cryptocurrency. Social media groups provide information on how to buy, trade, and mine cryptocurrency.
At the same time, Waqar Zaka, a former TV host, has over one million subscribers on YouTube for his bitcoin videos.
Zaka has cryptocurrency mining interests and has been an outspoken supporter of cryptocurrency legalization in Pakistan. He has been hired by a Pakistani provincial government to help them understand how to profit from such ventures.