Cryptocurrency, especially Bitcoin which is a digital currency hits the global market massively and now Pakistani investors are also showing a great interest in it. However, the main problem they are facing right now is about its legality as investors are still confused about its validity in the country.
A debate is going all over in Pakistan either bitcoin is legal or not? First of all people need to understand the concept of term “legal in regard to Cryptocurrency” by legal it means police won’t arrest you for investing in bitcoin; they won’t arrest you using bitcoin.
However, if you are a victim of any fraudulent and deceptive act, no one can help you. You can only get arrested for opening up an exchange that converts rupees to bitcoin.
As of 25 May 2017, the State Bank of Pakistan does not recognize digital currencies. Hence the trade of digital currencies or Bitcoin is not regulated by any law in Pakistan.
As per the orders of the SBP, virtual currencies such as Bitcoins are not considered as legal tender in Pakistan. For that reason, people should be careful in trading and using these currencies.
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SECP warned the investors about scams implicated in Cryptocurrency, earlier this year. We also have heard about the news that FBR took action against the money launderers who pick Bitcoin and other digital currencies to turn their black money into white.
The interesting part is, for bitcoin to be considered for money-laundering, it has to be put into an asset class whereby Bitcoin has been stated as “money” or some form of an asset as per “some” legal description in some law in Pakistan.
On the other hand, if they did not make a clear verdict to regulate bitcoin and categorize it into an asset class, just like money, then what is the legal basis and how something that is not defined by law is being pursued in these kinds of cases.
At the moment, the Government of Pakistan in no way identifies Bitcoin as legal tender. Yes, from government perspective it has no legal standing under any law in Pakistan. But people are still investing in it.
Bangladesh, Saudi Arabia, Turkey and few other countries have totally warned their users or you can say banned digital currencies because of its possible use in money laundering and tax dodging.
Due to the emerging trend of Cryptocurrency especially Bitcoin, now investors in the country demands from government to pass the law regarding Cryptocurrency to make things clear for them.