Pakistani Central Bank Argues In Favor Of Blanket Ban on Crypto

The decision is awaited on the part of the Pakistani Ministries of Law and Finance whether crypto should be outrightly banned or not.

State Bank of Pakistan (SBP) is the regulating and central bank of Pakistan. It has been reported in the Pakistani press that SBP is proposing that cryptocurrencies’ trading, as well as crypto transactions, should be banned.

A court case is pending before a High Court of Pakistan in which the Court has to examine the legal status of cryptocurrencies. In the said hearing, SBP along with other top authorities of Pakistan submitted documents before the Court. As per these documents, SBP and others are arguing before the Court that a blanket ban should immediately be imposed upon cryptocurrencies. SBP specifically told the Court that Bitcoin and other digital currencies like it shouldn’t be allowed to be used for trading or payment purposes. According to the regulating bank, such digital currencies are illegal and have no legal status under the law in Pakistan.

The Court proceedings were later covered by Pakistani electronic media. One of the news channels reported that SBP’s documents suggested that crypto is permanently banned in more than 11 countries. These countries were told to include countries such as Saudi Arabia, India, China, and various others. Thereafter, SBP prayed to the Court to direct the Government to immediately impose a ban. Meanwhile, SBP further asked the Court to empower SBP to impose penalties of fines upon crypto exchanges that are working in Pakistan.

SBP further told the Court that there are several pending investigations with top agencies of Pakistan involving cryptocurrencies. SBP argued that primarily crypto is used for illegal purposes such as terrorism funding, money laundering, and investment frauds.

Meanwhile, the Federal Investigation Agency of Pakistan (FIA) too appeared before the Court and apprised its case. FIA informed the Court that recently a crypto investment fraud has been complained off in the country. It further told the court that the fraud is linked with an offshore crypto exchange namely Binance, for whom FIA has already served notice.

After hearing the arguments of SBP and FIA, the Court has adjourned the case for further arguments without passing any orders. On the other hand, the Law and Finance Ministries of Pakistan have been suggested by SBP to approve a blanket ban on crypto. The decision is still awaited.