The Pakistani government has three months to develop regulations for the digital currency industry, a regional high court ruled. In its ruling, the court ordered the central bank and the securities regulator to work with other stakeholders on regulating the sector.
Pakistan is one of the many countries in South Asia that have seen a sharp increase in digital currency adoption in recent years. According to website traffic monitor Similarweb, digital currency trading apps like Binomo have seen more downloads from app stores than those from the country’s biggest banks.
Despite the adoption, Pakistan has yet to issue clear regulations for the industry.
The High Court of Sindh seeks to end this regulatory ambiguity. According to local reports, the court, which is the highest in southeastern Sindh province, has given the government three months to work on the regulation of digital currency.
The court, in particular, ordered the Securities and Exchanges Commission of Pakistan (SECP) and the State Bank of Pakistan (SBP) to partner with the Ministry of Law and Justice, the Ministry of Information Technology and other stakeholders to formulate infant industry.
For Pakistan, the fight against money laundering and terrorist financing through digital currencies is one of the main considerations. The country has been on the Financial Action Task Force (FATF) gray list for putting in place inadequate controls to tackle these flaws.
Pakistan continues to see great interest in Bitcoin, with local outlets reporting that social media groups dedicated to digital currencies continued to see several new members on a daily basis. It ranked third in the Chainalysis Global Crypto Adoption Index 2021 after Vietnam and India respectively.
The government has also slowly caught up, and this year set up a committee to study digital currency regulations, sourcing from the FATF, intelligence agencies and federal ministries. However, no concrete action has been taken following the recommendations made by the committee.
Educational institutions across the country are also catching up with the new wave. Earlier this year, Lahore University of Management Sciences received a $ 4.1 million grant to study and teach digital currencies and blockchain technology.
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