Like many major countries in the world, the topic of cryptocurrency is still controversial in Pakistan.
The number of people in the country who have invested more or less in crypto currency is not small.
On the other hand, while there are some positive hopes regarding the future of this digital currency in the world, there are also concerns related to it.
Some social media activists in Pakistan support the currency and have been campaigning to legalise it, but the government and the State Bank of Pakistan are reluctant to accede to their demand.
“There is a fear of use in terrorism”
Cryptocurrency was once again discussed in Pakistan’s Senate Standing Committee on Finance and Revenue, in which the legalisation of this currency has been strongly opposed.
The members of the Standing Committee said that “cryptocurrency can possibly be used for terrorist purposes, so we cannot declare this dubious currency as legal.’
It should be noted that since 2018, Pakistan’s name has been included in the grey list of the Financial Action Task Force (FATF), which is active around the world to prevent money laundering, and FATF has demanded that financial matters be made transparent.
Then, in October 2021, FATF removed Pakistan from the ‘grey list’.
Secretary of Exchange Companies of Pakistan Zafar Paracha considers the government’s decision not to legalize cryptocurrency to be correct.
“No one knows who is behind this currency”
Zafar Paracha said that there are many problems with cryptocurrency. Common currency notes are backed by the country and bear the words ‘The bearer shall pay the same on demand.’
On the other hand, this cryptocurrency is a virtual currency. No one knows who is behind it. It’s a software thing. There is no company or information to take responsibility for this.
Referring to the major fluctuations in the value of cryptocurrencies, he said, “Look, the value of currencies fluctuates against the dollar. It doesn’t happen very often, but the case of cryptocurrency is strange. It would suddenly go up by 10 to 50 percent or more and then come down very suddenly.’
There are so many concerns about this currency, so why is Pakistan investing in it? In response to this question, Zafar Pracha said that there is no check on it. No government, including Pakistan, has such a mechanism with the help of which cryptocurrency transactions can be stopped completely.
‘Risk of legalizing cryptocurrency will not be taken’
Zafar Pracha is not very optimistic about the future of cryptocurrency. “I don’t think it can be legal in Pakistan in the near future because Pakistan is a weak economy,” he says. It is under pressure from the FATF and the International Monetary Fund (IMF) and the reasons for this pressure are mostly related to global politics. Therefore, the risk of legalizing this currency will not be taken here.
STATE BANK Of PAKISTAN’S WARNING PUBLIC NOTICE
On the other hand, the State Bank of Pakistan is waiting for clear legislation or policy regarding cryptocurrency from the government.
This issue is currently under discussion at the standing committee level. So far, the State Bank has not allowed all banks to transact in cryptocurrency.
There is also a public notice on the State Bank website warning citizens about virtual currencies.
According to the notice, ‘State Bank has not authorised any person to transact, invest in, or exchange Bitcoin, Litecoin, Pakcoin, Onecoin, Dascoin, PayDiamond, or other such virtual currencies. Nor does the State Bank consider this process legal.’
The notice also addresses the potential risks associated with virtual currencies.
When contacted for an opinion on cryptocurrency, Dr. Qaiser Bengali, an expert in economic affairs, said, “I keep hearing talk about this currency, but I have never worked on it. I don’t know what it is, so I can’t say anything about it.