Cryptocurrency and Pakistan

Cryptocurrency, a digital asset having no precedent of its kind, has grabbed the attention of the world. It provides a high return to investors, which makes it an enticing digital asset. While praising its high returns, it is also equally important to consider its high volatility. The extent of its volatility is that investors may reach peak increase but then hit a tipping point after which the value suddenly declines — a phenomenon we are currently witnessing.

Where the world is benefitting from this mode of investment, Pakistan has restricted its residents from crypto mining. The reasons for this restriction and the future steps that the government might take in this regard are still unclear. Historically, with regard to any new technology, Pakistan has often been among the last participants in the race to embrace it, and it has often resulted unfavourably. Yet, our government and authorities are prone to making the same mistakes and showing blunt disregard towards the continuously evolving world. For a better Pakistan, the concerned authorities must make timely decisions.

Policymakers should first create a legal framework, then protect small or new investors against its high volatility by specifying the range of investment one can make based on their incomes. For instance, ‘A’ investor having ‘Z’ income can only invest within the range of ‘X-Y’ amount. Such a method may prove safe and highly fruitful in the long-run.