Pakistan Implements Ban on Cryptocurrencies to Combat Illicit Transactions

In a recent decision by the Senate Standing Committee on Financial Affairs, Pakistan has banned cryptocurrencies. The move comes as a response to concerns raised by officials regarding the involvement of billions of dollars from Pakistan’s funds in cryptocurrency. Despite calls for legalization from some quarters, the State Bank of Pakistan (SBP) considers cryptocurrencies to be fraudulent and vows to prevent their recognition in the country. The Federal Investigation Agency (FIA) and Financial Monitoring Unit (FMU) are also implementing strict measures to curb investments in cryptocurrencies.

Ayesha Goush Pasha, Pakistan’s Minister of State for Finance, made it clear that the government has no intention of legalizing cryptocurrencies. Both the SBP and the Ministry of Information Technology are taking steps to enforce the ban. Furthermore, compliance with guidelines from the Financial Action Task Force (FATF), an international body monitoring money laundering and terrorist financing, plays a significant role in shaping Pakistan’s position against cryptocurrencies.

Saleem Mandviwalla, a Pakistani MP and former Minister of Finance, expressed concerns about the substantial amount of Pakistani rupees invested in cryptocurrencies. In response, the State Bank of Pakistan assured that the FIA and FMU are actively addressing the issue. Despite the ban on cryptocurrency trading and mining imposed in 2018, Pakistan has observed a recent surge in cryptocurrency mining activities.

Pakistan has decided to block all internet-based services associated with cryptocurrencies. The government aims to combat illicit transactions involving digital currencies in line with FATF guidelines. The FATF had explicitly imposed a condition on Pakistan to never legalize cryptocurrencies. Sohail Javed, Director of the State Bank of Pakistan, supported this stance by highlighting the significant risks associated with cryptocurrencies. He pointed out that the cryptocurrency market, which once reached a valuation of $2.8 trillion, has now decreased to $1.2 trillion.

To enforce the ban effectively, Pakistan’s Federal Investigation Agency and Financial Monitoring Unit have been empowered to take stringent measures against individuals engaging in cryptocurrency transactions. The government’s decision to block internet-based services related to cryptocurrencies demonstrates its commitment to preventing the illicit use of digital currencies and safeguarding the financial system.

Pakistan’s ban on cryptocurrencies aligns with the FATF’s guidelines, emphasizing the country’s dedication to combatting money laundering and terrorist financing. By implementing strict measures against cryptocurrencies, Pakistan aims to ensure compliance with international standards and maintain a robust financial ecosystem.

Pakistan has taken a firm stance against cryptocurrencies, implementing a ban on their trading and mining activities. The decision is driven by concerns over the involvement of substantial amounts of Pakistani funds in cryptocurrencies and the perceived fraudulent nature of these digital assets. By enforcing the ban and blocking internet-based services related to cryptocurrencies, Pakistan aims to combat illicit transactions and adhere to international regulatory standards. As the country takes measures to safeguard its financial system, the cryptocurrency market’s value has significantly decreased.

Disclaimer: This article was created for informational purposes only and should not be taken as investment advice. An asset’s past performance does not predict its future returns. Before making an investment, please conduct your own research, as digital assets like cryptocurrencies are highly risky and volatile financial instruments. This is a news article only. 

Author: Puskar Pande

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