The State Bank of Pakistan (SBP), the country’s central bank, has reportedly taken the decision to ban the use of all cryptocurrencies in the country. The central bank has also asked the High Court of Sindh to prohibit “unauthorized operations” of crypto exchanges and impose sanctions on them.
Pakistan Inter-Ministerial Committee Recommends Banning of Cryptocurrency and All Related Activities
A high-level inter-ministerial committee formed to make recommendations on whether any form of cryptocurrency should be allowed under Pakistani law reportedly submitted its report to the Sindh High Court on Wednesday.
The committee was constituted by the High Court of Sindh under the supervision of the Deputy Governor of the State Bank of Pakistan (SBP) and officials from Pakistan’s Ministry of Finance, Ministry of Information Technology, Telecommunications Authority and the Securities and Exchange Commission.
The 38-page report, submitted to the court by SBP Deputy Governor Sima Kamil, recommends a comprehensive ban on all cryptocurrencies and related activities in Pakistan.
The committee said that cryptocurrency should be declared illegal, pointing out that after careful analysis, it found that the risks of cryptocurrency far outweigh its benefits for Pakistan. The report also warns that cryptocurrency could be used for money laundering and terrorist financing.
Additionally, the committee urged the court to prohibit “unauthorized operations” of crypto exchanges and impose penalties on them as some countries have done. The report cites recent investigations by Pakistan’s Federal Investigation Agency (FIA) into crypto exchanges, including Binance, and the risks they pose to investors.
The Sindh High Court ordered the committee to send a copy of the report to the Ministry of Finance and the Ministry of Justice to make the final decision on whether any form of cryptocurrency will be allowed in Pakistan. The court also ordered the two ministries to jointly recommend whether crypto activities of any form can be legally conducted in the country. They are due to report their decision on April 11.
Petitioner Waqar Zaka, TV host and crypto entrepreneur, argued that cryptocurrency should be declared legal. The court will resume hearing his motion on April 12.
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