If you run a quick search about Pakistan and cryptocurrency, what’s likely to come up near the top is talk of a ban. Indeed, it was just last spring that news broke of Pakistan banning cryptocurrencies in the country. This, however, can easily be misunderstood.
The word “ban” makes it sound as if cryptocurrency was made explicitly illegal, when in fact this is not what actually took place. This ban was more the State Bank’s way of asserting that bitcoin and other cryptocurrencies cannot be used as legal tender at official government institutions, which really isn’t very different from how cryptocurrencies are viewed and handled in most of the world. Going a small step further, it was also a declaration that financial institutions, payment processing services, and the like were not to facilitate individuals’ investment in or acquisition of cryptocurrencies. Basically, this was a ban on official cryptocurrency activates – not on all of them.
And now, nearly one year later, there are various factors suggesting Pakistan could in fact be opening itself up to a future with crypto involvement. Consider, briefly, the following points:
Bitcoin Is Less Threatening – When cryptocurrency was “banned” in Pakistan, it was arguably at its most threatening. The prices had come back down to Earth after a dramatic, lucrative 2017. However, they hadn’t stayed down long enough to convince people they wouldn’t jump right back up again. There were legitimate experts predicting another crypto surge. Now, however, while there are still some predicting a big 2019, we’ve gone over year since the 2017 crypto surge with no more movement resembling that jump. Cryptocurrencies, and bitcoin specifically, just aren’t as threatening as they once were, which could ease bank reactions.
Bitcoin Is Stronger Than Google – This is a curious little fact, but one that comes from an interesting list of things people probably don’t know about bitcoin. The assertion is not about size or market cap or anything of that nature, but rather the fact that computers connected to the blockchain generate more power than those connected to Google’s servers. This is not a meaningful fact in a direct or specific sense, but it speaks to the vast network of crypto-related computers around the world, and gives credence to the idea that cryptocurrencies will continue to spread by sheer force of will.
<strong>Banks Are Using Blockchain – This is maybe the most interesting point here simply because it comes from a story that surfaced not long after news of the aforementioned ban. Basically, a Pakistani embraced the blockchain for remittances, which does not in any way contradict the ban, but does speak to the usefulness of crypto-related technology. If banks start using the blockchain more frequently in Pakistan, it will start to feel inevitable that cryptocurrencies will be welcomed in some sense.
Economic Hardship Leads To Crypto – One of the simplest equations in the crypto world has proven to be that economic hardship leads to more cryptocurrency interest. Basically, when an economy turns downward, people cease to trust the attached fiat currency and look for alternative means of holding wealth and spending money – which now include cryptocurrency. It’s for this reason that when reports surfaced last summer of the Pakistani economy being on the brink of crisis, crypto trade volumes spiked.
Taking all of this into account, the future actually gets quite interesting. Cryptocurrency is less threatening yet more widespread, Pakistani banks are showing interest in the underlying tech, and there are tough economic times, at the moment and ahead. Together, these factors may counter the ban and make crypto a factor in Pakistan’s immediate future.