The State Bank of Pakistan (SBP) is preparing for the upcoming pilot launch of a digital currency in the coming months. Deputy Governor of SBP, Sima Kamil, revealed that after completing the necessary groundwork, the pilot launch of Pakistan’s first digital currency will take place within the next two months. The Arab News reported Kamil’s statement regarding the launch of a sandbox environment, which will be initiated within one to two months. The sandbox will provide a controlled space for testing innovative products, services, or business models in a limited and supervised manner.

This step is aligned with the SBP’s long-term strategy, known as “SBP Vision 2028.” The introduction of a digital currency is an important component of this five-year plan. While the SBP has previously taken a cautious approach to cryptocurrencies like Bitcoin, Litecoin, Pakcoin, OneCoin, and DasCoin, deeming them illegal, they have now decided to explore the creation of their own digital currency.

It’s important to note that central bank digital currencies (CBDCs), such as the one planned by SBP, differ from cryptocurrencies. CBDCs are designed to be more secure and are intended to complement physical cash and traditional electronic money. They leverage blockchain technology (DLT) to provide a secure and efficient means of conducting digital transactions.

A few countries have already launched their CBDCs, including Nigeria, Jamaica, and the Bahamas, while others such as China, India, Saudi Arabia, France, Ghana, Canada, and Uruguay have initiated pilot programs to study their implementation.

The SBP’s move toward a digital currency demonstrates their commitment to embracing technological advancements in the financial sector. This development could have significant implications for Pakistan’s financial landscape, as it aims to provide a secure and efficient digital payment system in line with global trends.

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