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Business Recorder
4 days ago
- Business
- Business Recorder
Legal gaps in crypto adoption
EDITORIAL: Pakistan's push to embrace cryptocurrency has seen the government take a host of measures over the last few months to promote the adoption of digital assets like Bitcoin. From the establishment of the Pakistan Crypto Council and appointing entrepreneur Bilal bin Saqib as its CEO with the status of minister of state, to allocating 2,000MW of surplus electricity for Bitcoin mining and the finance minister's declaration that Pakistan wishes to be a leader in this space, all reflect a coordinated effort to position the country at the forefront of the digital economy. What completely boggles the mind, however, is that amid this enthusiastic drive for crypto adoption, one basic fact has been persistently overlooked: cryptocurrency remains illegal in Pakistan. All transactions involving such assets are prohibited under current regulations, and anyone dealing in these currencies is liable to be investigated by the Financial Monitoring Unit and the FIA. This was made clear in no uncertain terms by senior officials of the State Bank of Pakistan and the finance ministry during a meeting of the National Assembly's Standing Committee on Finance and Revenue on May 29. Finance Secretary Imdadullah Bosal's categorical statement that 'crypto is not a legal tender in Pakistan' is something that casts a long shadow over the government's recent actions in this space. It highlights a shocking lack of policy coherence and prompts broader questions about the prudence of promoting crypto initiatives without first putting in place a clear legal framework. The result is a climate of confusion and uncertainty, leaving investors, regulators and the public unsure of the government's true policy direction and intent behind these contradictory signals. While some of the government's moves in this space may be seen as attempts to garner influence with the Trump Administration, which includes strong advocates of cryptocurrency, its actions appear to go beyond merely symbolic gestures. At the recent 2025 Bitcoin Conference held in Las Vegas, for instance, Bilal bin Saqib unveiled Pakistan's first government-led Strategic Bitcoin Reserve, intended to hold digital assets in state custody as a sovereign reserve. This, along with other initiatives, suggests a clear intent to integrate crypto into national economic strategy despite the legal and regulatory contradictions, and the inherent risks of embracing an asset class, which thus far has been known for its volatility, lack of effective oversight mechanisms and susceptibility to speculative bubbles. The fact of the matter is that cryptocurrency is not considered legal tender in most countries of the world, including in the US. There is still little regulatory clarity to the cryptocurrency space in most jurisdictions, with it long having operated on the fringes of the mainstream global financial system due to its volatile nature, resistance from central banks and limited mainstream adoption by businesses. This is not to say that cryptocurrencies cannot achieve legitimate adoption in a safe and regulated manner that preserves financial stability. But for that to happen, governments would need to establish clear regulatory frameworks that address consumer protection, financial stability risks and anti-money laundering concerns while fostering innovation. In Pakistan's case, crypto adoption demands carefully crafted regulations that balance risk — particularly regarding capital flight — with opportunities for financial inclusion and improved remittance flows. Given our fragile economic position and IMF commitments, we must proceed cautiously by first establishing a clear regulatory framework developed through collaboration between blockchain specialists, technologists and economic managers who understand both our economic challenges and risks of crypto adoption. The current approach of haphazard adoption without proper legal safeguards creates dangerous uncertainty: it encourages public investment in an illegal asset class, exposing citizens to potential legal consequences, and leaves our economy vulnerable to capital flight and money laundering risks. The government must rethink this blind embrace of crypto and first build legal guardrails before proceeding further. Copyright Business Recorder, 2025
Arab News
05-02-2025
- Business
- Arab News
Saudi cabinet approves memorandum of understanding with Pakistan to combat financial crimes
ISLAMABAD: Saudi Arabia's cabinet, chaired by Crown Prince Mohammed bin Salman, has approved a memorandum of understanding (MoU) with Pakistan's Financial Monitoring Unit (FMU) to enhance cooperation in combating money laundering, terrorist financing and related crimes, the Saudi Press Agency reported this week. Pakistan has faced significant challenges with money laundering and terrorist financing in recent years, leading to its placement on the Financial Action Task Force's (FATF) grey list in June 2018. After implementing comprehensive reforms to strengthen its financial system, the country was removed from the grey list in October 2022. The FMU, established under the Anti-Money Laundering Act of 2010, serves as Pakistan's financial intelligence unit, responsible for analyzing suspicious transaction reports and coordinating with international counterparts. '[The cabinet approved] a memorandum of understanding between the General Department of Financial Investigation at the Presidency of State Security in the Kingdom of Saudi Arabia and the Financial Monitoring Unit in the Islamic Republic of Pakistan regarding cooperation in exchanging investigations related to money laundering, terrorist financing, and related crimes,' the SPA reported. The MoU signifies the deepening strategic relations between Saudi Arabia and Pakistan. A significant Pakistani diaspora resides in the Kingdom, and numerous Pakistani businesses have established a presence there. Saudi Arabia has been a key supporter of Pakistan's economy, bolstering its reserves with substantial deposits in the State Bank of Pakistan and offering deferred oil payment facilities. The Saudi cabinet also highlighted the Kingdom's hosting of the INTERPOL Regional Bureau as a significant step, saying it underscored international recognition of the Kingdom's pivotal role in combating extremism and other crime in their different forms.
Express Tribune
04-02-2025
- Business
- Express Tribune
Pakistan, Saudi Arabia ink agreement to fight money laundering
Listen to article Saudi Arabia's Presidency of State Security has approved a memorandum of understanding (MoU) between the Saudi Directorate of Financial Investigation and Pakistan's Financial Monitoring Unit to enhance cooperation in the exchange of investigations related to money laundering, terrorist financing, and associated crimes. The decision was taken during the weekly cabinet meeting held in Riyadh on Tuesday, chaired by Crown Prince Mohammed bin Salman. According to the Saudi Press Agency (SPA), Minister of Information Salman Al-Dosari stated that at the beginning of the meeting, the Crown Prince briefed the cabinet on his recent discussions, including meetings with Syrian President Ahmed Al-Sharaa and German President Frank-Walter Steinmeier, as well as a phone conversation with European Council President António Costa. The cabinet discussed Saudi Arabia's diplomatic engagements with various countries concerning global peace and stability and expressed satisfaction over ongoing negotiations with Japan. A key highlight of the session was the kingdom's confirmation that it would host the regional headquarters of the International Criminal Police Organization (Interpol) for the Middle East and North Africa. The move is expected to strengthen efforts against terrorism and various forms of crime in the region. The cabinet also welcomed the final statement of the six-party Arab ministerial consultative meeting on Palestine, which emphasized the need for a lasting ceasefire and the acceleration of humanitarian aid deliveries to Gaza. Several agreements were approved, including a security cooperation pact between Saudi Arabia and Qatar. Additionally, the cabinet endorsed MoUs with Tajikistan and Azerbaijan, allowing diplomatic and service passport holders from these countries to travel visa-free. In a structural change, the authority to issue licenses in the financial and accounting sectors was transferred from the Ministry of Commerce to the Saudi Authority for Auditors and Accountants. The session also reviewed the annual reports of various government entities, including the Ministry of Municipal and Rural Affairs and Housing, the Hail Development Authority, and the Food and Drug Authority.
