Blockchain Jurisprudence: Regulation and Taxation of Cryptocurrency in Pakistan

Abstract

The cryptocurrencies have become a disruptive aspect of global finance that has endangered the conventional monetary frameworks and regimes. The debate is of concern to regulators in Pakistan as they attempt to strike a balance between innovation and financial stability, consumer protection, and global compliance. Specific focus will be given in the present paper to the legal obstacles to the introduction of cryptocurrency in Pakistan, such as the lack of a specific legal framework, inefficient tax laws and regulations, and the risk of money becoming a means of criminalizing money. The study, as compared to other countries, indicates that there is the need to have clear policies, exchange licensing, investor protection, mining and trading regulations. The potentials of cryptocurrencies to diversify the financial system of Pakistan as well as to decrease dependency on the dollar in trade are also discussed in the paper. The facts demonstrate that Pakistan is not able to ban and to legalize the usage of cryptocurrencies unconditionally. Instead, a harmonized legal and policy framework has to be established to legalize them, enable economic growth and protect financial integrity.