According to a report Friday by The News International, a high court in Pakistan has approved a commission to investigate whether cryptocurrencies are appropriate under the country’s legal framework.
The High Court of Sindh, the highest judicial authority in Sindh’s southern province, authorized the committee to investigate crypto trading and report its findings to the province’s Ministry of Finance.
If the committee determines that crypto trading is allowed under Pakistani law, suggestions will be sent to the ministry, along with a proposed framework for crypto regulation that is susceptible to change.
According to the article, the group would be led by a deputy governor of the State Bank of Pakistan (SBP) and will include officials from the Ministries of Finance, Information Technology, Telecommunication Authority, and the Security and Exchange Commission of Pakistan.
The court acknowledged that the decision to offer additional supervision over crypto trading activities in Pakistan was made not by choice, but rather out of pragmatism over potential black market business operations that are now outside of official jurisdiction.
Cryptocurrency has seen a surge in recent weeks, with the price of bitcoin reaching a new all-time high above $66,000 on Wednesday.
The popularity of trading digital assets, and hence the tax collections that result from such activity, is regarded as a powerful source of revenue for governments wanting to get a piece of the action.
While crypto trading is not legally banned in Pakistan, the SBP has put a restriction on those businesses it oversees that trade in crypto under existing regulations set in 2018.
In 2019, the federal government imposed stricter restrictions on the crypto business, requiring all Electronic Money Institutions to be licensed to provide crypto assets in accordance with Financial Action Task Force guidelines.