Cryptocurrency in Pakistan is not as popular as in other countries yet. The people of Pakistan appear to be hesitant about cryptocurrencies despite the many advantages they offer. One might wonder, what is the real reason behind their unpopularity? In today’s blog, you will explore the most asked question: Why Pakistan doesn’t encourage the cryptocurrency market to spread, even though the world has accepted it with much love? To be honest, there are many factors due to which digital money isn’t yet adopted in Pakistan, from cultural norms to religious concerns. Read the blog to find out which one is the prime roadblock in making crypto the most used currency in Pakistan.
What is Cryptocurrency?
Before getting into details, here is a quick intro to what it is and why is it taking over the world. Cryptocurrency is a type of digital currency in which, as opposed to a centralized authority, a decentralized system uses encryption to verify transactions and keep records. Some of the most popular crypto coins are Bitcoin, Litecoin, and Dogecoin. There are even popular websites such as Coingecko that provide insights about all of the trending coins.
Factors Contributing to the Unpopularity of Crypto Currency in Pakistan
Now, that we know how cryptocurrency works, here are some factors that have contributed to the slow adoption:
Lack of Education and Awareness
The lack of knowledge and awareness regarding cryptocurrency is one of the main factors contributing to its unpopularity in Pakistan. The majority of Pakistanis know very little to nothing about cryptocurrency and how it operates. Many misunderstandings and skepticism concerning it have been caused by this lack of understanding. Additionally, the lack of knowledge and awareness of cryptocurrencies is significantly impacted by the language barrier. Many individuals in Pakistan do not speak or understand English, and since the majority of the material on cryptocurrencies is written in this language, it acts as a roadblock for the nation the understand what is it and why it matters.
Regulatory Challenges and Legal Issues
The regulatory and legal difficulties are another reason for Pakistan's delayed acceptance of the modern currency. The public now feels a great deal of uncertainty and mistrust as a result of the lack of regulation. Businesses have found it challenging to use cryptocurrency because banks and other financial institutions are prohibited from doing so. Furthermore, it's still not clear what the law is in Pakistan regarding cryptocurrencies. Cryptocurrency regulation lacks a clear structure, which makes it challenging for enterprises to function in this market.
Security Concerns and Scams
Is cryptocurrency safe, is the most significant matter in Pakistan currently. Scammers and hackers frequently target cryptocurrency as a result of the lack of regulation and education surrounding it. Pakistanis are cautious of cryptocurrency since so many individuals there have been scammed by it. Furthermore, cryptocurrency prices fluctuate, which is another reason, why it is proven to be a risky investment in the Islamic country.
Is Cryptocurrency Halal?
One of the prime factors behind cryptocurrency being taboo in Pakistan is Islamic restrictions. Islam has severe prohibitions on interest and gambling, and Pakistan is a Muslim nation. Keeping that in mind, the country doesn’t approve of crypto as many scholars have declared it haram as it doesn’t qualify as currency according to Sharia laws of Islam. Moreover, it is culturally frowned upon as it is considered to be an act of gambling, which is ethically discouraged as well. In Pakistani culture, the idea of digital cash is also still very new. In Pakistan, a large portion of the population still favors cash transactions and is reluctant to embrace digital currencies.
Steps to Take to Promote Crypto Currency in Pakistan
To promote the adoption of cryptocurrency in Pakistan, several steps need to be taken:
· We need to work more on education and awareness. This can be achieved through workshops, seminars, and other educational programs.
· There needs to be a clear regulatory framework that will help to provide a sense of security and stability to businesses and individuals who want to adopt it.
· More efforts can be put in to address cultural and religious beliefs. This can be done by engaging with religious leaders and scholars to provide a better understanding of the technology.
· Lastly, the government must battle scams and security concerns associated with crypto, through building an establishment of regulatory bodies and the implementation of measures to prevent fraud and hacking.
Future Outlook of Cryptocurrency in Pakistan
In conclusion, there are several reasons why cryptocurrencies are disliked in Pakistan. However, religious disapproval is the prime one. Pakistan is a Muslim nation, there is less likely chance, for people to accept crypto as a new currency. As mentioned earlier, according to many scholars, digital money doesn’t qualify as currency according to Sharia rules. Islam and cryptocurrency don’t go hand in hand and it is less likely to come together anytime soon. So, even if we solve the issues discussed above, the government and legal won’t label crypto as an efficient currency to spend. Keeping this in mind, the future of crypto seems darker in Pakistan for now.