Experts have urged the government for swift but careful regulation of cryptocurrencies and virtual assets in the country as Pakistanis are estimated to have invested between $20 billion and $30 billion in asset-backed crypto instruments.
According to reports, experts at the Sustainable Development Policy Institute (SDPI) Conference warned that Pakistan could lose out on $25 billion in economic opportunities if it delays regulation of the same amid a global financial shift toward digital currencies.
They projected that crypto trading by Pakistanis could reach a staggering $300 billion, nearly equal to the country’s current GDP of around $400 billion. However, they cautioned that these figures are based on estimates since Pakistan lacks a legal framework to regulate or document crypto activities, leaving the true scale of investment unverified.
Experts at the conference also raised concerns over weak regulations and cybersecurity risks that could hinder progress. They recommended that Pakistan adopt a cautious, phased approach to legalising cryptocurrency and introduce a Central Bank Digital Currency (CBDC) as a first step. The CBDC could significantly reduce the costs associated with remittances from overseas, they said.
They agreed that digital finance has the potential to lower remittance costs, expand financial inclusion and align Pakistan with global fintech trends. However, they stressed that delaying regulation could result in Pakistan missing a transformative economic opportunity.
Meanwhile, Federal Finance Minister Muhammad Aurangzeb has said that Pakistan aims to advance the Pakistan Crypto Council (PCC) from a business perspective.
At the same conference, the finance minister indicated that legislation for a Virtual Assets Regulatory Authority, established through an ordinance, will be enacted soon.
It may be noted that reports in September claimed that Pakistan has formally launched the licencing process for cryptocurrency exchanges, marking a key milestone for the country’s digital finance sector.
The Pakistan Virtual Assets Regulatory Authority has invited global crypto service providers to apply for licences to operate in the country, they said.
Under the new framework, companies seeking licences must hold permits from global regulators, comply with strict “Know Your Customer” (KYC) requirements, and provide detailed corporate disclosures.
In March, the government established the Pakistan Crypto Council (PCC) to regulate and integrate blockchain technology and digital assets into the national financial system. The council’s formation followed the appointment of Bilal bin Saqib as Chief Advisor to the Finance Minister for crypto affairs.
The PCC was tasked with promoting and incorporating blockchain and cryptocurrency innovations into Pakistan’s economic framework.