Pakistan to Legalize Crypto: The Reasons Behind It

Pakistan is in the process of legalising cryptocurrencies to attract investment. The country intends to develop a clear regulatory framework for the growth of a local ecosystem, which already has more than 15 million users.

Pakistan is planning to create a legal framework for cryptocurrency trading to attract international investment, Bilal bin Saqib, head of the Pakistan Cryptocurrency Council, said in an interview with Bloomberg. The country intends to develop transparent regulations to foster the development of the local ecosystem.

Pakistan is the fifth most populous country in the world and the ninth most populous in terms of cryptocurrency distribution, according to Chainalysis. According to Saqib, between 15 and 20 million Pakistanis use cryptocurrencies.

"Pakistan will no longer be left behind. We want to attract international investment because Pakistan is a high-growth and low-cost market, where 60 per cent of the population is under 30 years old. We have a Web3-oriented workforce ready to develop,' Saqib said.

In 2023, Pakistani authorities decided to ban cryptocurrencies in the country. The then Minister of Finance, Aisha Ghaus Pasha, declared that cryptocurrencies would not be allowed and that their legalisation would not be considered. However, the authorities admitted that Pakistanis had already invested billions of dollars in cryptocurrencies.

The plan to legalise cryptocurrencies in Pakistan was developed after Saqib was appointed as the Finance Minister's chief advisor for the management of digital assets earlier this month. According to him, every country, including Pakistan, should follow the example of the US, where the president has made cryptocurrencies a national priority.

Donald Trump, who took office as US president in January this year, is a strong supporter of the cryptocurrency industry. He has vowed to make America the 'crypto capital' of the world, signing an executive order to create a strategic Bitcoin reserve, while his new administration is working to establish clear regulations in this area.

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In this context, journalists noted that several Asian countries have softened their attitude towards cryptocurrencies. Thailand is currently considering listing Bitcoin exchange-traded funds (ETFs) on local stock exchanges, while Malaysia's Prime Minister Anwar Ibrahim said the country should prioritise blockchain and cryptocurrencies.

Japanese authorities have noted that the public is starting to view cryptocurrencies as an investment asset and are discussing whether the government should include them in the Financial Instruments Act. South Korea is considering lifting its ban on institutions investing in cryptocurrencies, while the Central Bank of Cambodia recently issued guidelines for banks and payment companies that operate with digital assets.

Hong Kong has become one of Asia's major crypto hubs. Bitcoin and Ethereum ETFs were approved there in April 2024, a few months after the launch of such funds in the US. Earlier this year, a Hong Kong court began sending tokenized notifications to anonymous USDT crypto wallets involved in illegal activities.