As former cricketer-turned-politician Imran Khan prepares to take charge of Pakistan’s economy, some believe Pakistan is on the brink of an economic crisis. This crisis may increase the use of cryptocurrency in Pakistan.
Increase in Bitcoin Trading
According to Forbes reporting, citing figures from cryptocurrency trading platform LocalBitcoins, Bitcoin trading volumes in Pakistan are beginning to creep up.
Cryptocurrency markets as a whole are seeing an upturn, so the improved figures for Pakistan could also be a result of this increased market confidence, as well as the impact of financial uncertainty in Pakistan.
Economy on the Brink of Crisis
If Inram Khan can form a successful coalition government he will shortly become Prime Minister of Pakistan after leading his party, Pakistan Tehreek-e-Insaf (PTI), to victory. Khan has yet to reveal his economic policies but has committed to improving the economic climate as well as fighting corruption in Pakistan. Khan may be facing an economy in increasing trouble.
Gareth Leather, the senior Asia economist at Capital Economics, told Market Watch:
“Whichever party wins Pakistan’s upcoming general election will take over an economy on the brink of a balance of payments crisis. Growth is likely to slow sharply regardless of who wins Wednesday’s election.”
More difficult to Access U.S Dollars
In a move to prevent foreign-exchange reserves in Pakistan flowing out of the country, Bloomberg reports indicate that Pakistan’s central bank is making it more difficult for citizens to access U.S dollars. It’s actions like this, on centralized fiat currencies, which can also increase the popularity of decentralized cryptocurrencies that can enable fluid cross-border transactions.
Economic uncertainty in Iran, Greece, Venezuela, and other countries is also increasing regional interest as citizens look to retain the value and control of their assets. Iran is this week considering a state-backed cryptocurrency, following the example set by Venezuela with the “Petro” coin.
Pakistan advised its banks and financial institutions not to facilitate customers who transact with cryptocurrencies and ICO offerings in April 2018.
Considering the viewpoints of central banking institutions, a state-issued cryptocurrency is unlikely at this stage. But economic uncertainty and the recovery of cryptocurrency markets could well see cryptocurrency use increase in the country.
Do you think economic uncertainty increases cryptocurrency use? Let us know in the comments below.
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