The Sindh High Court has requested the top federal government agencies including, the State Bank of Pakistan (SBP), Securities And Exchange Commission Of Pakistan (SECP), Ministry of Finance, and various other institutions to come up with suggestions for regulation of cryptocurrency in the country.
It is the first time a senior court has issued an order to entertain the possibility of introducing cryptocurrency in Pakistan. The use of crypto-currency was previously banned by the SBP, stating all business transactions using crypto to be illegal. According to the two-judge bench headed by Justice Mohammad Karim Khan Agha, Pakistan needs to be updated with global financial trends and thus cannot afford to be isolated from the crypto race.
Previously, SBP and the SECP banned the use of cryptocurrency for business transactions, which forced businesses and crypto-users to take this transaction underground, creating unregulated and illegal activities in the economy. To minimize the size of the crypto black market and the illegal activities, the SHC has decided to give the novel currency a chance.
The regulation of cryptocurrency will also aid Pakistan’s battle against money laundering and terror financing, which continues to affect the country’s performance on the FATF. Globally, cryptocurrencies are widely accepted and used as a currency. In many countries, regulatory frameworks have been implemented to streamline and regulate the cryptocurrency market to prevent money laundering, terror financing and other illegal banking transactions.
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