A study by the Pakistan Federation of Chambers of Commerce and Industry (FPCCI) revealed that Pakistanis have $20 billion in cryptocurrencies. This amount exceeds the country’s own international reserve, valued at 18 billion dollars.
This brings us back to the use of Bitcoin as part of international reservations by countries, just as El Salvador is doing. After all, with each new dollar printing, for example, all countries that have USD are losing purchasing power.
Finally, the FPCCI report is a recommendation on how Pakistan should act in relation to cryptocurrencies, not yet regulated in the country. As an example, the document cites the US, China and India, each with a different mindset.
More crypts with the population, less fiat coins in international reserve
The last report The Central Bank of Pakistan (SBP), published on December 17, 2021, points out that the Bank has 18 billion dollars in international reserves. That is, in other currencies like Dollar and Euro.
I o report The Federation of Pakistani Chambers of Commerce and Industry (FPCCI) shows that Pakistanis own $20 billion in cryptocurrencies. This shows the size of the demand for cryptocurrencies relative to fiat currencies.
The Pakistani Rupee (PKR) has already lost more than 45% of its value against the dollar (USD) since its birth in 2013. Since January 2021, the drop is 9.73%. Bitcoin (BTC) has gains of 64% against the USD in the same period.
Although it is already being used as a store of value by many people and even large companies like Tesla and MicroStrategy, for now El Salvador is the only country with reserves in Bitcoin. Despite this, it is possible to imagine the digital currency being used by other countries.
Pakistan wants to regulate the crypto market
The strongest point of the document issued by the FPCCI is to expose the need to regulate the cryptomarket. After all, 20 billion dollars worth of cryptocurrencies is a huge amount for a country of 221 million people.
As an example of countries to be followed, the report points out the posture of three other countries in relation to cryptocurrencies. Among them are China and India, the most populous countries in the world, and also the USA, a world power that is more open to cryptos.
The table shows the differences between these countries and also shows how the process of creating their CBDCs is going. While China has banned trading and mining of cryptocurrencies, the US allows both activities, while India and Pakistan are halfway there, even though they are two countries among the three with the highest adoption of cryptocurrencies.
On the digital coins of central banks, CBDCs, Pakistan and the US are still not so motivated to launch them. China and India are in more advanced stages of digitizing their currencies.
Finally, the report recommends that Pakistan follow the advice of the International Monetary Fund (IMF) and the International Financial Action Group (FATF).
Separated into three phases, the document cites a cryptocurrency declaration scheme (to collect taxes), expansion of the legislative framework to address cryptocurrencies, the creation of an exchange, the launch of ETFs and, finally, the monitoring and surveillance of transactions , as well as capital control restrictions and the non-recognition of cryptocurrencies as legal tender.