LHC directs SECP to determine legal status of cryptocurrency with stakeholders

LAHORE: The Lahore High Court (LHC) on Friday directed the Security Exchange Commission of Pakistan (SECP) to hold a meeting with all stakeholders to determine the legal status of cryptocurrency and submit a report in this regard on next hearing.

Justice Jawad Hassan was hearing a writ petition challenging the jurisdiction of a special court for banking offences to hear a post-arrest bail petition by a suspect arrested by the Federal Investigation Agency (FIA) in a case related to cryptocurrency.

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At the outset of the hearing, the petitioner’s counsel pointed out that so far legal status of cryptocurrency has not been determined. Upon which, the court directed that all stakeholders should sit together and deliberate to find a solution. The LHC further directed to involve lawyers in the deliberations.

The court also directed to hold deliberations through a conference call in Lahore, Karachi and Islamabad and present a draft of the proceedings in the court. Justice Jawad Hassan lamented that when the government institutions did not work, people had to approach the courts. Further proceedings on the case will take place on January 19.

An FIR was lodged by the FIA against the suspect, Dr Muhammad Zafar, on allegations of defrauding public in the name of investment in cryptocurrency to the tune of over Rs260 million.

Advocate Javid Kasuri argued on behalf of the petitioner that the banking court had no jurisdiction to deal with the matter.

He explained that the special courts were established with the mandate to proceed with the trial of scheduled offences as per section 4 of Banks (Special Courts) Ordinance, 1984.

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The counsel contended that the core point involved in the case related to issuance of cryptocurrency by the suspect who was neither a bank nor authorised by the SBP or any bank, therefore, the judge of special court had no authority to deal with the matter.

Justice Hassan had already suspended the impugned proceedings pending before the special court till final decision of the petition.