The government of Pakistan has taken a significant step by deciding to prohibit the sale and purchase of cryptocurrencies within the country. The decision was made during a meeting of the Standing Committee on Finance of the Senate, chaired by Senator Saleem Mandviwala. The objective of this ban is to prevent the use of cryptocurrencies and related services on the internet. The government has initiated efforts to impose restrictions on the circulation of digital currencies, including the prohibition of cryptocurrency-related software.
Crypto Market Shrinks from $2.8 Trillion to $1.2 Trillion, State Bank of Pakistan Reports
During a briefing on cryptocurrencies, the State Bank of Pakistan highlighted the risks associated with these digital assets. The cryptocurrency market has experienced a significant decrease, from $2.8 trillion to $1.2 trillion. Sohail Jawad, Director of the State Bank (central bank of Pakistan) , emphasized that cryptocurrency is a high-risk form of currency and deemed it a complete fraud. He further asserted that cryptocurrency would never be allowed in Pakistan, questioning its legitimacy and lack of practicality. Both the Federal Investigation Agency (FIA) and the Financial Monitoring Unit are taking action against Pakistani investments in cryptocurrencies. Jawad highlighted the creation of over 16,000 cryptocurrencies, which he deemed useless.
Ayesha Ghos Pasha emphasized the sensitivity of the issue and stated that cryptocurrency would not be permitted. Considering the recent exit from the Financial Action Task Force (FATF) gray list, Pasha emphasized the need to avoid the risks associated with cryptocurrencies. It was made clear that the legalization of cryptocurrency in Pakistan would never be considered.
Pakistan Prohibits Banks from Crypto Transactions, Citing Regulatory Challenges
Director Sohail Jawad further explained that banks were instructed in 2018 not to engage in transactions involving cryptocurrencies. Countries like Pakistan are particularly vulnerable to such currencies. He stated that cryptocurrencies cannot be regulated or monitored effectively and highlighted China’s decision to ban the internet and restrict the use of cryptocurrencies.
Committee Chairman Saleem Mandviwala acknowledged that billions of dollars have been invested by Pakistanis in cryptocurrencies. He expressed awareness of individuals actively involved in cryptocurrency businesses who may continue their operations despite the ban. Farooq H. Naik recommended strict punishment for those Pakistanis involved in cryptocurrency-related activities, urging the implementation of legislation.
