In a move aimed at combating illicit digital currency transactions, the Pakistani government has declared the suspension of cryptocurrency services provided over the internet. This decision, announced by the State Bank of Pakistan (SBP) and the Ministry of Information Technology, is part of their ongoing efforts to prevent the misuse of cryptocurrencies within the country. Compliance with the directives has already begun, signaling a firm stance against the legalization of cryptocurrency in Pakistan.
Government Officials Assert the Risks Associated with Cryptocurrency
During a briefing to the Senate Standing Committee on Finance, Dr Aisha Ghaus Pasha, the Minister of State for Finance and Revenue, made it clear that cryptocurrency would never be legalized in Pakistan. The Financial Action Task Force (FATF) has imposed restrictions on the matter, setting a condition that cryptocurrency will not receive legal recognition. Echoing Pasha’s stance, Sohail Jawad, the Director of SBP, emphasized the high risks associated with crypto transactions and stated that permission for such activities would never be granted.
The market for cryptocurrencies, once valued at $2.8 trillion, has now shrunk to $1.2 trillion, as mentioned by Jawad. The Pakistani government’s concern over the billions of dollars invested in the market is being addressed through the efforts of the Federal Investigation Agency (FIA) and the Financial Monitoring Unit (FMU), which actively combat terrorism financing and money laundering.
Cryptocurrency trading and mining have experienced a significant surge in Pakistan, evident in the growing interest through social media videos and online exchange transactions. Although the government previously banned virtual currency trading and mining in April 2018, cryptocurrency mining continues to thrive in the country, even with the closure of several mining farms. Operating discreetly through undisclosed partners, most exchanges evade regulatory oversight. Nevertheless, the government remains determined to curtail crypto trading act
ivities.