Pakistan, one of the top 10 nations to transfers from abroad, can take advantage of blockchain technology to streamline the process, said Bilal Bin Saqib, chief adviser of the Finance Minister and member of the newly established Pakistan Crypto Council (PCC), Monday.
Overseas Pakistanis sent over $ 31 billion in 2023-24 via traditional channels that are often slow and expensive, Saqib told Coindesk in an interview. Fees can exceed 5%.
Transfers are earnings that migrants send home, either as cash or as goods. The cash from abroad is a lifeline in many countries where they act as a buffer during crises and a potential driving force for sustainable growth.
“PCC will investigate blockchain-based transfer solutions to reduce costs and delays,” he said. “In addition, we invest in blockchain training, calling programs and web3 development to cultivate talent, increase employment and drive economic growth.”
Blockchain technology can help improve fund transfers from abroad by disinteresting devices as correspondent banks, potentially reducing the cost of cross-border transactions observed OECD by 2020.
Trade in Cryptocurrencies and StableCecoins remains banned in Pakistan during a 2018 circular circular from the State Bank of Pakistan (SBP), which prohibits financial institutions from facilitating crypto transactions.
Still, the country is one of the five Asian nations shown in Chainalyses’ 2024 Global Crypto Adoption Index. A significant percentage of the population uses digital assets to uncover against inflation and volatility in the exchange rate and the wider economy.
“This reflects a significant demand despite the regulatory vacuum. With over 60% of Pakistan’s 240 million people under 30, our technically knowledgeable young people are ready to operate blockchain and web3 innovation,” Saqib said. “PCC aims to unlock this untapped potential by advocating a clear, progressive regulatory framework.”
PCC also examines initiatives such as tokenization of assets in the real world and the establishment of regulatory sandboxes while ensuring compliance with Financial Action Task Force (FATF) standards. Fatf removed Pakistan from the gray list in 2022.
“Illegal crypto outflows is a problem,” he said “Without regulation, Cryptocurrencies can facilitate undeveloped cross-border transactions, aggravate dollarel.
Regulatory policies are beginning to develop globally, including in Southeast Asia, in the wake of President Donald Trump’s support for industry Digital Assets after winning the US presidential election.
Last week, Trump announced plans for a strategic Bitcoin reserve that will be formed by BTC and other coins seized under enforcement measures. Saqib was not sure if such a movement fits Pakistan.
“While building a BTC reserve from seized assets could be appealing, Pakistan’s crypto enforcement is beginning, and illegal holdings are rarely captured in scale. Any movement against a strategic reserve would require careful dialogue with the IMF and FATF to avoid danger of international support or Pakistan’s post-g list,” said Saqib.
