A high court in Pakistan has approved a committee to explore whether cryptocurrencies are advisable under the country’s legal system, according to a report Friday by The News International.
The High Court of Sindh, the peak judicial body in the southeastern province of Sindh, granted permission for the committee to consider crypto trading and report its findings to the province’s Ministry of Finance.
Should the committee find crypto trading permissible under Pakistani law, then recommendations are to be forwarded to the ministry alongside a draft framework for crypto regulation, subject to modification.
The committee is to be chaired by a deputy governor of the State Bank of Pakistan (SBP) along with officials of Ministries Of Finance, Information Technology, Pakistan Telecommunication Authority and Security and Exchange Commission of Pakistan, according to the report.
The court conceded that a decision whether to provide greater oversight around crypto trading activity in Pakistan came not by choice but by pragmaticism over the potential black market business dealings currently outside government purview.
Cryptocurrency has experienced a boom in recent weeks, with the price of bitcoin hitting a new all-time high on Wednesday above $66,000.
Popularity in trading digital assets and, therefore, tax receipts that occur from such activity are considered a strong source of revenue for governments looking to get their hands on a piece of the action.
Higher prices are continuing to drive new traders and are raising the industry’s profile among the mainstream.
While crypto trading is not strictly illegal in Pakistan, under current regulation imposed by the SBP in 2018, a ban is in place for those firms it regulates that are dealing in crypto.
In 2019, Pakistan’s federal government put in place tougher regulations for the crypto industry by mandating all Electronic Money Institutions be licensed to provide crypto assets under recommendations from the Financial Action Task Force.