KANALCOIN NEWS – The State Bank of Pakistan (SBP), which is the central bank in Pakistan, has issued a circular prohibiting the public from dealing or transacting using cryptocurrency. This prohibition step was taken after the same step was taken by the Central Bank of India, which is none other than Pakistan’s neighboring country.
The circular stated that commercial banks as well as providers of payment services have been informed in more detail that they must stay away from crypto operations in any form. They are also prohibited from providing cryptocurrency and token transaction facilities. Pakistan’s central bank said that virtual currencies such as Bitcoin, Litecoin, Pakcoin, Onecoin, Dascoin, Pay Diamond as well as tokens from coin offerings cannot and are not legal tender in the country. This is not guaranteed by the Government of Pakistan, the financial institution notes.
Still according to circular letter No. 03 published through The State Bank of Pakistan (SBP) website, the central bank also absolutely does not give permission to any individual or any entity to issue, sell, buy or exchange any virtual currency and coins within the country.
“Furthermore, Banks / DFIs / Microfinance banks and payment system operators (PSO) / Payment Service Providers (PSP) have been advised not to facilitate their customers / account holders to transact in virtual currencies / Initial Coin Offerings (ICOs) / Tokens Vide BPRD’s”. Excerpt Text in a statement issued by the Central Bank of Pakistan
There are no specific laws regarding cryptocurrencies adopted in the country. The authorities, however, have shown a negative attitude towards bitcoin on many occasions. The Federal Investigation Agency, which has carried out several operations against cryptocurrency traders, recently called on the government in Islamabad to declare digital currencies “persona non grata”.
In accordance with the stipulated stance, all banks, microfinance entities, payment system operators and service providers are “advised to refrain” from dealing with cryptocurrencies. That includes “processing, using, trading, holding, transferring and investing” in digital coins. The SBP also said that banks and companies should not facilitate crypto transactions from their customers and account holders. Pakistani banks have been asked to immediately report on each such transaction to Financial
Monitoring Unit or FMU. All crypto transactions have been called “suspicious”.
Meanwhile a circular letter has also been signed by the director of Bank Negara Muhammad Akhtar Javed, asking the bank to acknowledge the receipt.
The local Pakistani press reports that the Central Bank of Pakistan issuing a circular banning crypto is a major development. This follows a similar decision by the Reserve Bank of India. The RBU ordered the country’s regulated financial institutions to stop all services to individuals and businesses dealing in cryptocurrencies such as bitcoin. Just like India, Pakistan has seen an increase in interest in cryptocurrencies since last year when the market capitalization of bitcoin and its ilk hit an all-time high. However, the fact remains that the local crypto sector is not as developed as in other countries, including Pakistan and India.
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