Cryptocurrency is called the currency of the future but in today’s world, it has become a business trend. Big businesses and brands are adopting cryptocurrencies not only for investment purposes but also to pay their employees and purchase items online.
If we talk about the trend of cryptocurrency in Pakistan, we have seen a huge increase in the purchase of crypto which has cost millions of dollars but due to a lack of framework and unorganized networks people are facing fraud and they lose their money.
In January 2022, Pakistani people lose USD 100 million in online cryptocurrency fraud worth around 17.7 billion Pakistani Rupees.
Many people in Pakistan want to invest in cryptocurrencies but they are worried about the future of cryptocurrency in Pakistan due to the uncertainty of cryptocurrencies and unclear policies by the government.
If you are one of those who have a plan to invest in cryptocurrency and want some research about this so this article is a complete guide for you. So Keep reading this article will be helpful to you.
Future of Cryptocurrency in Pakistan
Cryptocurrency, crypto-currency, or crypto is an intangible, decentralized currency based on blockchain technology that uses cryptography to secure transactions and can be used on electronic devices such as computers, mobiles, tablets, etc. The stats said that there are more than 18000 cryptocurrencies that exist in the market and as you know the leading are Bitcoin, Ethereum, Binance coin, Tether, Litecoin, Dogecoin, Cardano, Polkadot, Ripple, etc.
The growth of cryptocurrency in Pakistan is increasing day by day but the policy and legal framework of the government are not supporting crypto and its growth. According to the report of ANI, Pakistani citizens bought cryptocurrency worth 50 Million USD in just six months. There are 1,064 individuals from private banks and foreign exchange firms who made 2,923 transactions worth billions of Pakistani rupees.
That’s good but the bad thing is that the Premier Investigation Agency FIA jumped on the bandwagon and froze 1,054 accounts because the crypto has not been legalized in Pakistan. In 2018, the State Bank of Pakistan (SBP) banned Cryptocurrencies and declared them illegal and the regulator did not authorize anyone in the country to trade them.
The only solution to such problems in Pakistan that has been discovered so far is banning culture. Any technology or invention that can be exploited is banned instead of regulated. Many technologies and inventions have so far encountered this banning culture, including YouTube, TikTok, PUBG, and 3D printers and now the cryptocurrency is facing the same.
Waqar Zaka is a man who has been fighting cases in the courts alone against the legalization of crypto and banning culture. Waqar is a Pakistani crypto influencer, and entrepreneur, who often promotes and teaches crypto on social media. He tried to persuade all provincial governments to set up Pakistan’s first crypto mining farm using hydropower and finally, the KPK government permitted him.
Despite the ban on crypto by the State Bank of Pakistan, crypto activities are going on in Pakistan while the crypto ban has become meaningless after the Khyber Pakhtunkhwa government’s plan to set up cryptocurrency mining farms in northern areas so far crypto has not been declared legal in Pakistan.
Reza Baqir, Governer of the State Bank of Pakistan, said that the use of cryptocurrencies is more of a risk to Pakistan than a benefit. At the 13th Karachi Literature Festival, he also added that the use of bitcoin is mainly seen in speculation and remittances, the SBP cannot allow it to carry out such activities.
Why Cryptocurrency is Important?
Cryptocurrency is a digital currency that is not managed by someone and is based on blockchain technology. Blockchain means there are every transaction is recorded in the blockchain and is managed through advanced encryption tools that make it more secure.
Some time ago, we used to hear from tech gurus and also see in movies that in the future there will be no fiat currency for shopping, everyone will have digital currency for payment and purchase. Today, many countries have introduced their digital currency including Russia, China, Jamaica, Sweden, etc.
A growing number of retailers and Internet sellers are beginning to accept bitcoin as a form of payment which increases the importance of cryptocurrency. Cryptocurrency allows people to send money without banks and other financial institutions, which greatly reduces transaction fees.
Some countries can’t use PayPal and Google Pay. These are the top payment systems in the world. If you live in one of the countries where Google Pay and PayPal are not available, you send money via cryptocurrency with minimal transaction fees. The following are the advantages and disadvantages of illustrating the importance of cryptocurrency.
Advantages of Cryptocurrency
- The advantage of cryptocurrency is that it has many apps and programs that help you to trade freely across borders.
- By and large, cryptocurrency has become superior to most traditional physical currencies. Mostly because it doesn’t require a lot of infrastructure to work.
- One of the major benefits of using cryptocurrency is that it makes it easier for employees to make payments. For example, if you have many remote employees in different parts of the world, you will have to convert your local currency into dozens of international currencies to pay your employees. So, with cryptocurrency, you get instant transactions.
- As I mentioned above, it is created and managed using state-of-the-art encryption techniques that make it more secure and lower transaction fees than most traditional methods.
- You have access to create a crypto account anytime and anywhere. All you need is a mobile phone or computer and an internet connection and you can create your crypto wallet instantly.
Disadvantages of Cryptocurrency
- Crypto assets lack key features of sovereign currencies. That is why many people are reluctant to use it for payment or transactions, as it is not fully accepted as a mainstream form.
- There is no authority who owns cryptocurrency to ensure its smooth running. The future of cryptocurrencies depends on their ability to deal with issues such as the value of cryptocurrencies.
- There are many fluctuations in the value of cryptocurrency which make cryptocurrency volatile investments.