The government has been urged by the High Court of Sindh (SHC), Pakistan’s highest judicial authority, to come up with procedures for cryptocurrency regulation and also a report on deliberations surrounding the process.
The SHC handed the instruction while hearing a case challenging the validity of Pakistan’s 2018 crypto prohibition, according to Pakistani English daily The Express Tribune.
The High Court of Sindh (SHC) has directed regulators such as the Securities and Exchange Commission of Pakistan (SECP) and the central bank to establish crypto legislation in three months in collaboration with government departments such as the Ministries of Information Technology and Law.
The SHC also requested that a report on the efforts taken to regulate cryptocurrencies be submitted within the same time frame as the proceedings.
The government is apparently consulting on cryptocurrencies in order to combat money laundering and terrorism financing, especially in light of criticism from the Financial Action Task Force.
The SHC’s order on Wednesday makes Sindh the latest province in Pakistan to seek that cryptocurrencies be recognized in some way.
The Khyber Pakhtunkhwa assembly called on the federal government to legalize cryptocurrency in December 2020. At the time, politicians cited the widespread use of digital currencies as evidence that cryptocurrencies were on their way to supplanting fiat currency in the future.
Another of Pakistan’s four provinces, Khyber Pakhtunkhwa, announced plans to launch crypto mining farms in the region in March.
Meanwhile, the State Bank of Pakistan (SBP) is researching central bank digital currencies, as are many other central banks around the world.
The court urged players in a separate crypto-related lawsuit before the Lahore High Court, including the SECP, the SBP, and the federal government, to provide legal points on the topic in forthcoming proceedings. Punjab’s capital, Lahore, is one of Pakistan’s four provinces.