Is Pakistan still going to ban cryptocurrency right now?

Recently, the Central Bank of Pakistan (SBP) and the government decided to ban all cryptocurrencies. In April 2018, SBP banned financial service providers from promoting and using virtual currencies and banned domestic and foreign money from interfering with payments and returns. .

However, Khyber Pakhtunkhwa passed a resolution in December 2020 legalizing cryptocurrency and cryptocurrency mining.

And the Securities and Exchange Commission (SECP) of Pakistan has started the process of establishing a cryptocurrency regulatory framework to regulate the trading of digital financial instruments in Pakistan.

Meanwhile, when talking about restrictions, laws and regulations in the process, what is the problem?

Cryptocurrency growth is against the limit

In October 2021, the Sindh High Court ordered the government to regulate cryptocurrencies for three months as the SBP and the government decided to ban all cryptocurrencies.

Although the above is prohibited, the development of cryptocurrencies in China is uneven.

On January 10, 2022, the Federal Bureau of Investigation (FIA) of Pakistan released a report on the Binance cryptocurrency exchange to investigate crypto scams affecting hundreds of millions of dollars in currency.

Previously, data from the Pakistan Policy Advisory Board showed that Pakistan could earn thousands of dollars from its crypto-assets. Receive part of the rules, income.

According to the Pakistan Chamber of Commerce and Industry (FPCCI), the total value of crypto assets held by Pakistani citizens since December 2021 is estimated at $20 billion, more than the currencies of the Central Bank of Pakistan. The Chainalysis report also shows that Pakistan has the third highest cryptocurrency adoption rate in the world.

At the end of last year, the FIA ​​placed more than 1,000 bank accounts in markets involved in cryptocurrency exchanges worth a total of $288,000, including Binance and Coinbase. The agency also warned residents that SBP issued a notice in April 2018 “No buying and selling of cryptocurrency.”

Additionally, in April 2019, the bank's chief executive announced that SBP was exploring the idea of ​​digital benefits to support the country's "development," including financing, increasing the efficiency of financial institutions and reducing corruption. also plan to create a digital banking company by 2025 and complete the digital transformation of services and technology by 2030.

In addition to the ban, the development of cryptocurrency in Pakistan reached its peak today. What is a special development?

Prior to the enactment of the national law, states legalized cryptocurrency and mining.

In fact, in early April 2018, SBP issued a notice prohibiting all Korean financial service providers from promoting and using virtual currencies, including payments and exchanges while traveling and abroad.

On September 4, 2017, China also decided to ban, which led to a slowdown in the national crypto industry, but the value of the currency represented by BTC quickly rebounded. A similar situation exists in Pakistan, where the value of PakCoin, the first and only cryptocurrency in Pakistan, has increased by more than 60%.

Meanwhile, Urdubit, the country's first bitcoin exchange, announced its closure after the ban and demanded that consumers withdraw their money as soon as possible. The Urdubit co-founder said the move was aimed at restricting the domestic cryptocurrency market.

However, in practice, this does not prevent an investor from trading cryptocurrencies in other ways, and there are also media outlets reporting that the ban is effective.

In March 2019, the SECP shut down nine cryptocurrency companies offering Ponzi scams. However, the governor of the bank at the time said that he was studying the concept of digital benefits and planned to release information such as the digital bank money business.

In addition, the government has announced controls and licenses for companies operating in e-money to ensure the security of e-money and payment services. This shows that the government has gradually opened up and allowed businesses to exist and operate.

However, the above does not prevent the invasion of cryptocurrency mining sites. In January 2020, the FIA ​​arrested two illegal producers of cryptocurrency mining pits, known as the largest cryptocurrency pits in China, with up to 65 units.

In November of the same year, news broke that the government was preparing a basis for regulating cryptocurrencies such as Bitcoin. Released on November 6, this paper outlines the key elements of digital financial sector transformation in Pakistan and examines the existing regulatory frameworks established by different laws across the world.

In December, Khyber Pakhtunkhwa Province passed the Legal Regulation of Cryptocurrency and Cryptocurrency Mining. Not only is it the first state in Pakistan to set up a cryptocurrency council and a mining advisory council, but it has also adopted plans by local councils to develop two power stations to support cryptocurrency pilots . Bitcoin mining.

Pakistan's Sindh High Court complained that the Federal Reserve failed to comment on the cryptocurrency enforcement, but said the SBP never declared the cryptocurrency illegal.

In this, even though it has not been long since the Pakistani government announced the ban on cryptocurrencies, some states have been formed in advance, and it is unclear how the situation in the country will develop.

Central bank digital currency, a crack?

After the chief executive of the bank announced the digital banking announcement plan from April 2019, he said that it would be beneficial to be cautious about cryptocurrencies in April 2021.

"We are in the research phase and hope to be able to announce it in the coming months." At the same time, central banks have actively explored digital advantages.

Yesterday, a candidate for Fed headquarters said the Fed was slowing down the development of a blockchain strategy and a global CBDC ecosystem. Central Bank of India established CBDC Fintech R&D department, delayed CBDC operation in Thailand, Central Bank of Russia operated CBDC operation after January holidays…

According to the report, China is expected to become the first independent country to implement the major CBDC program. Currently, CBDCs in China have been tested in many cities and are compliant. A Japanese pundit has said that Japan could be six years behind China in the CBDC tournament.

The road to the CBDC is very difficult. If the country bans cryptocurrencies and creates CBDCs, it will follow China, but the truth will happen in the distant future, no one can see the time.

But what we can see is a historical comparison. Even national leaders will be confronted with the path laid out by the future nation. Although the results are also different depending on their own courage and innovation.

Writer Fitzgerald said: "Tomorrow we'll run a little faster, we'll stretch our arms a little more and one day...