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Business Recorder
an hour 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
Time of India
3 days ago
- Business
- Time of India
Big embarrassment! Pakistan's crypto attempt to 'please' Donald Trump in a soup
The State Bank of Pakistan and the Ministry of Finance both clarified that cryptocurrency transactions remain prohibited in Pakistan. (AI image) Pakistan's scramble to please US President Donald Trump by establishing a strategic bitcoin reserve seems to have landed it in a soup! According to a report in the Dawn, senior officials in Islamabad have said that cryptocurrency remains banned in Pakistan. The State Bank of Pakistan and the Ministry of Finance both clarified that cryptocurrency transactions remain prohibited in Pakistan, with all such dealings considered unlawful under existing regulations. At a session of the National Assembly's Standing Committee on Finance and Revenue, Finance Secretary Imdadullah Bosal explained that despite the recent establishment of a Crypto Council by the Prime Minister Shehbaz Sharif through executive order to explore digital asset policies, the prohibition on cryptocurrency remains enforced under SBP and SECP guidelines. According to the Dawn report, Bosal said, "There will be a legal framework only when the government formally takes a decision, but the current legal status is that crypto is not a legal tender in Pakistan." He emphasised that formal legislation would be necessary to alter the current status. Also Read | Donald Trump's trade policy thrown into turmoil! Will countries like India, China be tempted to hold off tariff talks? Members of the committee voiced their bewilderment regarding the government's stance. Mirza Ikhtiar Baig raised concerns about the contradiction where citizens were being prompted to invest in cryptocurrency despite its legal prohibition, cautioning that such investments could result in severe repercussions for the investors. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Beyond Text Generation: An AI Tool That Helps You Write Better Grammarly Install Now Undo Pakistan's Strategic Bitcoin reserve plans The potentially embarrassing clarification by officials comes even as a big declaration about creating a government-supported Strategic Bitcoin Reserve has been made. Pakistan Crypto Council CEO Bilal Bin Saqib in a presentation at the Bitcoin Vegas 2025 Conference announced his country's intentions to establish a government-supported Strategic Bitcoin reserve. The initiative was described as "strategic" and was perceived as an effort to align with US President Donald Trump's pro-cryptocurrency position. "We want to thank the US because we are getting inspired from them," Bilal said after the announcement. Also Read | Target where it hurts: India wants Pakistan back on FATF 'grey list'; to oppose World Bank loans Sohail Jawad, the executive director of State Bank of Pakistan, informed the committee about the central bank's stance on cryptocurrencies. He confirmed that they had declared cryptocurrencies illegal in 2024, and emphasised that this position "was still intact", as reported by Dawn. He further mentioned that the Financial Monitoring Unit continues to forward cryptocurrency-related cases to law enforcement authorities. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
