Pakistan Implements Nationwide Ban on Cryptocurrency Trading and Usage (May 18, 2023 at 23:19 PM)
In a recent development that has sent shockwaves through the cryptocurrency community, Pakistan’s Minister of State for Finance and Revenue, Aisha Ghaus Pasha, has declared a fresh ban on cryptocurrencies in the country.
This bold move has once again highlighted the divided opinions regarding the regulation and acceptance of digital currencies around the world. While the government’s stance remains steadfast against cryptocurrencies, many Pakistanis continue to see them as a viable investment and a hedge against economic uncertainty.
The announcement made by Minister Aisha Ghaus Pasha made it clear that Pakistan has no intention of legalizing cryptocurrencies in the foreseeable future. The government has concerns about the unregulated nature of digital currencies, their potential for facilitating illegal activities such as money laundering and terrorism financing, and the risks they pose to the country’s financial stability.
Pasha emphasized that the State Bank of Pakistan (SBP) has not authorized any individual or entity to deal in cryptocurrencies and warned of strict legal action against those involved in their trading or mining.
Cryptocurrencies will “never be legalized in Pakistan,” said Minister of State for Finance and Revenue Aisha Ghaus Pasha to the country’s Senate Standing Committee on Finance on Wednesday, according to local reports.
According to a local news outlet, the minister claimed that the Financial Action Task Force (FATF) had stipulated that cryptocurrency will not be legalised in order to keep it off the so-called “Grey List” of the international financial watchdog. Another claimed that Pakistan’s stated position is because it contravenes the FATF’s requirements.
The ban is not entirely surprising, as Pakistan has previously expressed skepticism towards cryptocurrencies.
In April 2018, the SBP issued a circular prohibiting all banks and financial institutions from engaging in any transactions involving cryptocurrencies. However, despite the ban, the popularity of cryptocurrencies has continued to grow in the country, with many Pakistanis viewing them as an alternative investment avenue and a means to protect their wealth from inflation and economic volatility.
Crypto enthusiasts in Pakistan argue that digital currencies provide a decentralized financial system, offering greater financial freedom and opportunities to the unbanked population. Additionally, they believe that cryptocurrencies can act as a hedge against traditional financial systems, which are prone to corruption and inefficiency. With limited investment options and a history of economic instability, many Pakistanis see cryptocurrencies as a way to preserve and grow their wealth.
According to the World Bank, Pakistan received approximately $29 billion in remittances in 2021, making it one of the largest recipients of remittances worldwide. Cryptocurrencies provide an efficient and cost-effective way for overseas Pakistanis to send money back home, bypassing the traditional banking system and its associated fees and delays.
While the Pakistani government remains firm on its ban, some experts argue that a complete prohibition might not be the most effective approach. They suggest that instead of outright banning cryptocurrencies, the government should focus on implementing robust regulatory frameworks to mitigate the risks associated with their use.
This would provide a more balanced approach, allowing for innovation and investment while ensuring consumer protection and financial stability.
In conclusion, Pakistan’s announcement of a fresh ban on cryptocurrencies has stirred up controversy and debate. While the government continues to view digital currencies with skepticism, many Pakistanis see them as a valuable investment and a means to protect their wealth. The ban has not deterred crypto enthusiasts who believe in the potential of cryptocurrencies to revolutionize the financial landscape.
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