After a year of ban on cryptocurrencies, Pakistan’s attitude towards electronic money has finally changed. Recently, Pakistan’s central bank, the National Bank of Pakistan (SBP), issued a statement saying that institutions that are willing to use “electronic money” can now obtain permission from the central bank to issue “electronic money for electronic payment purposes”.
According to the report by Pakistan's local media The Express Tribune, the government has held a meeting on April 1st at the Islamabad office of the National Bank of Pakistan to discuss and formulate “Electronic Money Institutions (EMI) regulations.
Compared with 2015, the attitude of the Pakistani government towards cryptocurrency has changed a lot. At that time, Pakistan was included in the grey list of the Financial Action Task Force (FATF), which showed that the country’s anti-terrorist financing and money laundering laws were not effective. This month, the Financial Action Task Force F once again expressed concern about this, prompting the Pakistani government to more seriously encrypt the currency issue.
Government regulation will work:
Muhammad Ahsan, founder of the blockchain consulting firm Go4 Blockchain, expressed his appreciation for the decision of the Pakistani government to regulate the use of electronic money.
“This step reflects the forward-looking thinking of the Pakistani government. With more regulations and reforms, passwords will have better room for development in Pakistan. However, Pakistan still has a long way to achieve results in the field of cryptocurrency. There is a way to go."
On April 6, 2018, a report on the ban on cryptocurrency by the Pakistani government was first released. Prior to this, the Central Bank of Pakistan issued a statement announcing that no individual or entity could be authorized to issue, exchange or invest in any virtual currency/coin/token. The statement said security-related issues, volatility in cryptocurrencies, and unstable cryptographic services and transactions were the main reasons for the ban.
Now, the Pakistani government is ready to begin a careful review of preventive measures, which will make passwords a tool for protecting the country and preventing it from being used for money laundering, terrorist fundraising and other illegal purposes.
Pakistan wants to strengthen ordinary people's perception of cryptocurrency:
Due to the cryptocurrency ban, there have been few signs of cryptocurrency use in Pakistan in the past 12 months. Ahsan mentioned:
“The retail and commercial industries still tend to trade through traditional banking systems.”
Ahsan believes that cryptocurrency is based on demand, but for now, the traditional financial system is working well and effective, and telecom companies and microfinance banks have sufficient strength to provide banking services for bank accounts, which further reduces Pakistan. The need for cryptocurrencies. He added:
“The only way to provide cryptocurrencies to the public is to educate them on how to use cryptocurrencies. But at the current rate, it may take several years for Pakistan to accelerate the development of cryptocurrency, making it a widely accepted form of public. currency."
Muhammad Usman Khan, chief operating officer of the Crypto Council at the Emirates Blockchain Knowledge Center, said
“Most retail and commercial communities still rely heavily on traditional business models and cash transactions,” which further increases Pakistan’s demand for cryptocurrency acceptance. Even in 2019, only a small percentage of the retail community in Pakistan accepted payments in electronic form. At the same time, a large amount of business in the country is still carried out in the informal sector through cash transactions. ”
According to Khan, digital payment solutions have facilitated the adoption of blockchains in Pakistan. However, due to the lack of appropriate and supportive cryptocurrency regulations in Pakistan, accepting cryptocurrencies and making it a form of payment may still be a long-term challenge.
On the other hand, some entrepreneurs in Pakistan have shown great interest in the blockchain. But Usman pointed out that most of the interest comes from outsourcing IT-related services, such as blockchain development. At present, Pakistan's interest in other applications of blockchain is still very small.
Usman hopes that the support of blockchains by entrepreneurs in the educational institutions, technology incubators and blockchain industries will increase Pakistan's interest in blockchains. These support, together with the above-mentioned government regulatory policies, will promote the development of Pakistan's cryptocurrency project and become a stepping stone for Pakistan's widespread acceptance and use of cryptocurrencies.