Is Initial Bitcoin legal or illegal in Pakistan?

Bitcoin Market in Pakistan

As discussed earlier, Bitcoins are of crucial importance when it comes to developing countries, where a lot of people do not have access to banks, especially in remote areas.

The Arrival of Bitcoin exchange in Pakistan

Urdubit was the first and biggest Pakistani Bitcoin exchange established in October 2014. Founded by Danyal Manzar and Zain Tariq, this platform operated over Blink trade’s platform and engine. The owners of this exchange came to know about Bitcoins in 2012, one year after the Bitcoin Boom, which gained media attention. The creators saw a gap in the market for a country like Pakistan where $16 million or above came as overseas remittances, and many of them are for people living in remote areas with no access to banks. As per the Dawn report from April 2018:

Pakistan is home to 100 million adults without a bank account, with 13 percent of adults citing religious concerns as a reason for not having an account at a financial institution, a World Bank report on the use of financial services revealed.

Urdu bit decided to target the Freelance market of Pakistan for whom the money exchange or cash payments are an issue. Freelancers were a huge market in Pakistan at that time (May 2016) too. To accommodate such a massive number of users, Urdubit decided to partner with Bitwage. But all this was ceased as Urdubit announced to shut down all of a sudden! However, talented youth from Freelancer.com is still getting a lot from it. Thanks to them that they are also operating in Pakistan.

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Issues with Bitcoin in Pakistan

Pakistan became one of the medium density Bitcoin region on the world map in 2014. A lot of people in Pakistan started to use Bitcoins for their transaction as it offered an easier way out. In a report from Tribune in February 2014, one of the famous tech gurus and payment expert Faisal Khan recorded his stance on Bitcoins:

“At present, there is no official stance on Bitcoins in Pakistan. However, there is no cost on Bitcoin transactions, and that makes it a very attractive perspective”

For quite a long time there appeared no government stance over the regulation of Bitcoins in Pakistan. The issue was only rendered to debates and articles where people presented the pros and cons of using bitcoins in Pakistan. One of the reasons for the confused, somewhat disputed opinion about bitcoins was its alleged use in money laundering activities worldwide, making the digital currency extremely volatile. Few rendered it to be an issue with the transparency of transactions, which is essential with the state bank of Pakistan. So anytime that the bitcoins are to be approved, there needs to be a transparent mechanism to accept the system nationally.