Islamabad- Pakistan intends to set a legal framework for cryptocurrency trading in an attempt to attract international investments, according to Bloomberg’s CEO of the Pakistani cryptocurrency council, Bilal bin Thaqab.
Last Friday, the Pakistani Finance Minister, Mohamed Orenquet, emphasized the pivotal role of the Pakistani encrypted currency council in drawing the country’s future in the field of digital assets and blockchain technology.
Orencies said during the opening meeting of the council that it will work as a central platform that brings together regulatory authorities and stakeholders in the sector to develop a responsible organizational framework and an advocacy of encrypted currencies.
Pakistan is ranked ninth in the world in terms of the adoption of encrypted currencies, according to the company “Chenalisis”, and Bilal Bin Thaqab said in the interview that there is between 15 and 20 million users of encrypted currencies in Pakistan.
transformation
Although cryptocurrency trading is very popular in Pakistan, the Pakistani Central Bank has warned of the risks posed by this industry.
According to the Pakistani newspaper “Business Ricurender”, the growth of the cryptocurrency community in Pakistan has led to discussions at the government level on the potential benefits and risks associated with the legalization of encrypted currencies.
According to the newspaper, despite the previous warnings of the government and the financial organizational authorities in the country about the use of virtual currencies – which indicated concerns related to money laundering, terrorist financing and consumer protection – this transformation in the perspective prompted the government to reconsider its position, realizing the global trend towards digital financing.
In a move indicating the government transformation in this context, the Pakistani Ministry of Finance recently established the National Council of Correcking Currencies, in an important step aimed at keeping pace with the country emerging global trends in the field of digital financing.
At the beginning of this March, the government appointed Bilal bin Thaqib as a major consultant to encrypted currencies, to facilitate the process of merging the blockchain techniques and digital assets in the Pakistani financial system.
In exclusive statements to Al -Jazeera Net, Bilal bin Thaqab said that Pakistan, like most countries, had a cautious look at digital currencies in the past, but this is now changing, as driving is now open to the idea of ”embracing” digital currencies.
“We are already the fourth largest market for independent employees in the world, and Pakistan is receiving more than $ 30 billion annually from financial transfers,” he added.
Foreign investments and taxes
Bringing foreign investments and improving the financial system in Pakistan is highlighted as one of the most prominent reasons that prompted the government to develop a framework for the regulation of encrypted currencies in the country.
“Our goal is a clear goal, which is a balanced approach that harnesses the tremendous capabilities of the Blockchain technology and encrypted currencies, while protecting consumers and investors, and compliance with international standards issued by the Financial Work Group (FTF) and the International Monetary Fund remain the essence of our strategy,” said Bilal bin Thaqab.
For his part, the digital assets expert Ali Farid Khawaja says that the government is now aware of the possibility of attracting foreign investments, in addition to generating tax revenues from organizing this industry.
Khawaja told Al -Jazeera Net that there are two aspects of this matter, which are bitcoin mining and cryptocurrencies.
In the field of mining, there is an awareness of the possibility of taking advantage of the surplus energy that Pakistan has to generate bitcoin, and the United States establishes a bitcoin reserve, and other countries such as the Emirates, Bhutan and El Salvador are implemented similar projects at the national level.
The second aspect is the trading of encrypted currencies, as the government can attract global trading platforms such as “Beans” and “Queen Pace” to establish branches in Pakistan and collect taxes from investors through these platforms.
The economist and researcher at the Center for Space and Security, Dr. Othman Shuhan, says that the transformation of the government’s position on encrypted currencies can unleash great economic capabilities by enhancing local technological entrepreneurship, attracting Pakistani investments, and attracting foreign direct investment to the infrastructure of financial technology.
Shuhan – who issued several books on encrypted currencies – says in an interview with Al -Jazeera Net that with appropriate guarantees and organizational clarity, Pakistan has an opportunity to consolidate its position as an advocacy center for digital financing in the region, which provides censorship and openness to one of the most shift technologies in the modern era.
Regulating digital assets
The Business Recorder newspaper says that the current legal structure in Pakistan does not currently recognize encrypted currencies as a legitimate assets or a method of exchange, as there are many laws that govern financial activities, but none of them explicitly stipulates digital currencies.
Ali Farid Khawaja says that the regulation of digital and transparent assets does not mean ratification, but rather to set regulatory requirements and set rules and systems for operations and control.
Khawaja added that despite the warnings of the State Bank, millions of Pakistani citizens invest in encrypted assets, and it is clear that the government has failed to prevent this, so it is much better to organize these assets and set controls to protect customers.
For his part, Dr. Othman Shuhan says, “The central bank’s approach to warning from encrypted currencies does not contradict the wider government’s tendency towards organizational clarity, but rather they are complementary.”
Shuhan added that the central bank is highlighting the risk of using unorganized cryptocurrencies, especially hierarchical plans and fraud, such as Bonzi, which previously harmed public investors.
He pointed out that reconciling these two positions requires acknowledgment of the possibility of developing organizational frameworks to reduce risk.
Growing market
The CEO of the Pakistani encrypted currency council, Bilal bin Thaqib, told Al -Jazeera Net that research indicates that between 15 and 20 million Pakistani currently possess digital assets.
“We ranked third on the international digital currency adoption index in 2021, and we are currently ranked among the top ten,” he added.
He explained that once this framework is applied, the world will witness the emergence of Pakistan as the capital of encrypted currencies in South Asia, noting that this will provide enormous opportunities, not only in investment, but also in innovation and exchange of knowledge and economic growth, which reflects the success that we have seen in countries that depend on encrypted currencies.
Digital currency expert Ali Khawaja says that there are no reliable sources of accurate data about the size of this industry in Pakistan.
He added that most estimates indicate that Pakistan is one of the most prominent global markets for the adoption of cryptocurrencies, as some of these estimates put it among the best 3 markets, while other estimates indicate that they are among the 10 best markets.
He pointed out that more than 20 million people use encrypted currency platforms in Pakistan, and it is easy to make sure of this, as the “Bennes” platform is among the 5 most download applications in the financing category in Pakistan on Android operating system phones.
For his part, Shuhan says that digital currencies are witnessing a continuous increase in their popularity, especially among young Pakistanis who are familiar with technology, who seek financial independence and protection from regular risks, and in light of the economic recession and fluctuations of exchange rates and capital controls and external economic pressures that provide digital currencies an attractive alternative as a storage of value and an investment tool.
He adds that while it is difficult to obtain accurate numbers due to the ambiguity of the world of digital currencies, the highest estimates indicate that Pakistan includes tens of millions of digital currency users, and many of them have small investments.
When asked about the most prominent digital currencies circulating in Pakistan, Bilal bin Thaqab refused to talk about it, saying, “I cannot comment on the trading and investment of digital currencies in it, it may be mistakenly thinking that it is a financial advice.”
