Pakistan’s crypto boom has spiraled into a full-blown crisis, transforming into a haven for fraudsters while regulators struggle to respond. Despite being ranked third globally in cryptocurrency adoption, the country lacks the legal safeguards, trust infrastructure, and enforcement mechanisms necessary to protect investors.
As the crypto craze deepens, countless Pakistanis — from professionals to influencers — have fallen victim to scams. For a nation already battling severe economic headwinds, the crypto chaos underscores deeper problems in governance, transparency, and institutional accountability.
Crypto Craze Meets Weak Oversight
Pakistan’s enthusiasm for digital assets has grown rapidly, but it comes with heavy risks. Talha, a data scientist quoted by Dawn, said he lost all his savings after storing his crypto wallet’s recovery phrase on Facebook Messenger.
“There was no login attempt, no alert — the funds just vanished,” he said, describing how scammers lure victims by “letting them win small before trapping them on larger bets.”
Muneeb, who runs a Facebook page called Pakistan iFrauds, shared how his attempt to report a crypto scam backfired.
“Authorities filed a case against me instead. I had to pay a bribe of Rs 700,000 just to close it,” he alleged.
Such stories highlight not just investor vulnerability but also systemic corruption and weak institutional recourse.
Mass Adoption, Minimal Regulation
Pakistan’s crypto ecosystem is enormous — with over 250 active apps and platforms like Binance downloaded millions of times — yet largely unregulated.
Fintech expert Zeeshan Ahmed noted that Pakistan’s digital asset market “lacks trust infrastructure,” the foundational element that separates legitimate financial systems from speculative chaos.
While initiatives like the Pakistan Crypto Council (PCC) and the Virtual Assets Ordinance (VAO) have been announced, most sections of the new regulations remain “under development” or “launching soon.”
The Human Cost of the Crypto Chaos
Investors across Pakistan continue to suffer devastating losses. One doctor from Sindh reportedly lost nearly Rs 1 million after following investment advice from a podcast that failed to disclose it was sponsored content.
Regulators, including the State Bank of Pakistan (SBP), have repeatedly warned that virtual assets are not legal tender and remain unauthorized for issuance, exchange, or investment. Yet, crypto adoption continues to soar, widening the gap between law and practice.
Implications Beyond Finance
Pakistan’s unchecked crypto boom carries broader implications for governance and regional stability. For India, the situation serves as a cautionary signal.
A state unable to manage digital finance effectively, analysts warn, may also struggle in other critical domains — from counter-terrorism and money laundering to cross-border trafficking.
Islamabad’s failure to build a secure, transparent financial oversight system reflects institutional fragility that extends beyond markets. The crypto crisis, experts say, offers a revealing glimpse into Pakistan’s deeper structural weaknesses — both economic and administrative.
