The Peshawar High Court’s recent directive has highlighted the pressing need for regulation of cryptocurrency trading in Pakistan. The court’s order demands the federal government to develop a comprehensive policy on the matter, with a deadline of two months. This development is significant, as the country struggles with the growing issue of unregulated crypto activities, particularly in Khyber Pakhtunkhwa.
Background and Legal Framework
Cryptocurrency trading, which involves buying, selling, and exchanging digital currencies, has been largely unregulated in Pakistan. Despite a 2018 notice from the State Bank of Pakistan declaring such trading illegal, it continues to flourish on various platforms. The petitioner, Barrister Huzaifa Ahmad, pointed out that many coaching centers in Khyber Pakhtunkhwa promote cryptocurrency and forex trading without any oversight. These centers often advertise on social media platforms like TikTok, Facebook, and YouTube, reaching a vast audience.
- The petitioner also noted that these centers have not registered with the Securities and Exchange Commission of Pakistan (SECP), missing out on the opportunity to contribute to tax revenue.
- Furthermore, the petitioner highlighted the risks associated with unregulated activities, including potential connections to money laundering and financing terrorism.
- He emphasized that such illegal trading could threaten national security and undermine the country’s efforts to combat terrorism and money laundering.
Government Response and Concerns
In response to the court’s directive, the Deputy Attorney General mentioned that the government is already drafting legislation to regulate cryptocurrency trading. The court, however, postponed further hearings until the new policy is presented. The government’s response suggests that they are taking steps to address the issue, but the court’s intervention highlights the need for a comprehensive policy.
| Key Points | Government Response |
|---|---|
| Drafting legislation to regulate cryptocurrency trading | The government is already working on this, but the court’s directive emphasizes the need for a comprehensive policy |
| Postponing further hearings until the new policy is presented | The court is waiting for the government to take concrete action and provide a clear policy framework |
Need for a Comprehensive Policy
The court’s directive highlights the need for a comprehensive policy on cryptocurrency trading in Pakistan. Such a policy would provide a clear framework for regulation, ensuring that all stakeholders are aware of their responsibilities and obligations. A well-designed policy would also help to minimize risks associated with unregulated activities, including money laundering and financing terrorism.
“A comprehensive policy on cryptocurrency trading is essential to ensure that the benefits of digital currencies are realized while minimizing the risks associated with unregulated activities.”
The petitioner’s concerns about the risks associated with unregulated activities are well-founded. The lack of regulation in the cryptocurrency trading sector can lead to a range of negative consequences, including the potential for money laundering and financing terrorism. A comprehensive policy would help to address these concerns and ensure that the sector is subject to robust regulations.
Conclusion
In conclusion, the Peshawar High Court’s directive on cryptocurrency trading is a significant step towards regulating the sector in Pakistan. The court’s order emphasizes the need for a comprehensive policy, which would provide a clear framework for regulation and minimize risks associated with unregulated activities. Key Takeaways:
* The Peshawar High Court has directed the federal government to develop a policy on cryptocurrency trading. * The policy should be comprehensive and provide a clear framework for regulation. * The government is already drafting legislation to regulate cryptocurrency trading. * The court’s directive emphasizes the need for a well-designed policy to minimize risks associated with unregulated activities.
