Home / Crypto Currency / Opinion: Pakistan Made a Big Mistake by Banning Cryptocurrencies and ICOs

Opinion: Pakistan Made a Big Mistake by Banning Cryptocurrencies and ICOs


Join our community of 10 000 traders on Hacked.com for just $39 per month.

State Bank of Pakistan, the country’s central bank, has recently banned cryptocurrency trading and initial coin offerings (ICOs). The rash decision of the bank could become a major mistake for Pakistan’s economy moving forward.


Throughout 2018, many of the major economies internationally including South Korea, Japan, and the US have embraced the cryptocurrency market. The three countries have imposed practical regulations for cryptocurrency exchanges and investors, and Japan has already introduced its intention to legalize initial coin offerings (ICOs).

The South Korean government and the Financial Services Commission (FSC) released its plans to legalize domestic ICOs once again, as soon as taxation policies for token sales are drafted and passed by the government. While the US and the Securities and Exchange Commission (SEC) are cracking down on unregulated iCOs, the SEC clearly stated that it is open to regulating private iCOs if it goes through the agency. So far, the SEC has stated that not a single ICO has applied to the SEC.

Earlier this year, Kakao, South Korea’s largest internet conglomerate which manages KakaoTalk, KakaoPay, KakaoTaxi, KakaoStory, and other massively popular applications in the country, teased its plan to launch a blockchain venture and an ICO outside of the country, due to the strict policies of South Korea. Consequently, the South Korean government stated that it may allow domestic ICOs, if they are approved by local financial authorities.

While major economies are scrambling to regulate the cryptocurrency market, small economies like Pakistan and Vietnam have completely shut out the cryptocurrency market, rejecting users, investors, and businesses, and possibly billions of dollars.

On April 6, the State Bank of Pakistan announced that local financial institutions, banks, and credit card service providers are not allowed to be involved in the cryptocurrency market in any way, and are not allowed to process cryptocurrency transactions, promote, and invest in the cryptocurrency market. It completely dismissed its local cryptocurrency market.

In hindsight, Pakistan’s ban on cryptocurrencies has virtually no impact on the global cryptocurrency market, given that the Pakistan cryptocurrency market does not even account for 0.1 percent of the global cryptocurrency market. But, Pakistan has made an error in dismissing overseas blockchain companies that could potentially expand into or relocate to countries like Pakistan for cheaper resources.

Case of Malta

Malta has taken the opportunity to appeal to the blockchain sector and companies within it. This week, Changpeng Zhao, the CEO at the world’s largest cryptocurrency exchange Binance, stated that 20 large market cap companies, mostly billion-dollar companies, are planning to move to Malta, following the roadmap of Binance.

In its official statement, Binance also revealed that it will hire 200 full-time employees in Malta to oversee its cryptocurrency exchanges, which are expensive positions to fill given most of the openings are for full-time developers. Tron and other multi-billion dollar companies may do the same and move to Malta, while blockchain startups disregard countries with impractical regulations, such as India, Vietnam, Pakistan, and Thailand.

Featured image from Shutterstock.

Follow us on Telegram.
Read more

Check Also

Institutional Investor: Crypto Will be Worth Trillions, Launches Hedge Fund

After leaving his position as an executive at Steven Cohen’s Point72 hedge fund, Travis Kling decided to start his own crypto-focused fund. This was a big and bullish announcement back then, but it still wasn’t enough to save the crypto market, which crashed only a month later. The following nine months were almost completely ruled by the bears, which has brought a lot of damage to the crypto world. Still, according to new reports, Kling has never given up on this project, and it seems that he will finally be ready to launch the new hedge fund over the next month. The dates have not been set yet, and it is possible that the fund’s launch will be as soon as in about two weeks. Former Point72 Manager Plans the Launch of His Own Crypto Fund The fund has been expected for a long time now, and according to what is known, it will be based in Delaware. Some reports even managed to find out that the name of the fund will supposedly be “Ikigai”. While nobody known for sure when the fund’s launch is actually going to be, it is known that it will happen in October. At first, the fund will be backed by a certain amount of capital that Kling’s unnamed partners have invested. However, later down the line, after the project starts its development properly, Kling plans to search for additional investors. Additionally, he will also add $15 million on November 1st, according to the reports. Eventually, by the time the mid-2019 arrives, Kling hopes that the fund will grow and expand to around $100 million. He even expects Ikigai’s venture branch to rise to $33M in capital invested. As for the foreign investors interested in the fund, they will be capable of allocating capital through investment vehicle based on the Cayman Islands. A Multi-Trillion Asset Class? During one of his recent interviews, Kling stated that he truly believes in the project, as well as the concept, and those willing to back it. This, more than anything, indicates that the project is more than just an attempt to generate large profits. Kling stated that he expects this to become a multi-trillion asset class that will expand to touch everyday life. He stated in an interview: It’s still very early, but the development and growth of this technology will be exponential. The firm will have a 13-person team that is said to be located in Los Angeles, while the fund will seemingly follow the regulations implemented by the Delaware government. Many believe that Ikigai’s launch will come on October 1st and that most of the allocated capital will remain in cash, at least at first. This is due to the fact that the investors are still trying to find a secure way into the crypto world. The post Institutional Investor: Crypto Will be Worth Trillions, Launches Hedge Fund appeared first on NewsBTC.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Disclaimer: Trading in bitcoins or other digital currencies carries a high level of risk and can result in the total loss of the invested capital. theonlinetech.org does not provide investment advice, but only reflects its own opinion. Please ensure that if you trade or invest in bitcoins or other digital currencies (for example, investing in cloud mining services) you fully understand the risks involved! Please also note that some external links are affiliate links.