The Securities and Exchange Commission of Pakistan has published a paper discussing cryptocurrency regulation in the country. Meanwhile, the central bank has reportedly confirmed that there is no cryptocurrency ban.
Pakistan’s Crypto Regulation in the Works
The Securities and Exchange Commission of Pakistan (SECP) has published a position paper on the regulation of cryptocurrency trading platforms.
Besides discussing definitions and concepts of cryptocurrencies, the paper outlines different regulatory approaches adopted globally, including the recommendations by the Financial Action Task Force (FATF), and regulations in Malaysia, Hong Kong, and the U.S. It also details how cryptocurrency could be recognized in Pakistan and regulatory proposals. “This consultation paper focuses exclusively on non-government or non-central bank issued crypto assets and not on central bank digital currencies [CBDCs],” the paper notes.
The paper discusses two approaches available for regulating cryptocurrencies. Firstly, cryptocurrency can be regulated and restricted according to existing regulations “and may in some instances even entail outright banning,” the SECP wrote.
Secondly, cryptocurrency can be regulated “based on the conjecture of ‘let-things-happen’ approach, described by the Commodity Futures Trading Commission (CFTC) as the ‘do-not-harm’ approach … where the financial sector is considered as dynamic and the associated need to innovate is strongly emphasized.”
The SECP says its position paper “is mainly prepared based on [the] second approach,” adding that it “intends to hold multiple discussion session and welcomes any input/comments.” The position paper can be found here.
No Crypto Ban
Meanwhile, the State Bank of Pakistan has reportedly clarified that cryptocurrency is not banned. The central bank’s lawyer recently told the Sindh High Court that the bank issued a warning about dealing in…