A panel of Pakistan’s central bank has suggested that cryptocurrencies and associated activities be completely banned in the nation.
According to a media report on Thursday, a panel of Pakistan’s central bank has suggested a complete ban on cryptocurrency and other similar operations in the nation, days after a top court ordered an investigation into a USD 100 million digital currency fraud.
The Sindh High Court (SHC) ordered the State Bank of Pakistan (SBP) to form a committee under the supervision of the bank’s Deputy Governor to investigate the fraud after it became public.
The group also included representatives from the finance, information technology, telecommunications, and Securities and Exchange Commission ministries.
According to The News International, the court requested the committee’s view on whether any type of cryptocurrency might be legal in Pakistan.
The committee recommended a complete ban on all cryptocurrencies and related operations in the country in its report.
According to the publication, a risk-benefit analysis has revealed that the risks of cryptocurrency “much outweigh” the benefits.
The committee found that bitcoin was traded for speculative purposes, with people being tempted to invest in the hopes of making short-term capital gains.
According to the committee, such inducement could lead to the departure of valuable foreign exchange reserves as well as the movement of criminal funds out of the nation.
The committee stated that unlicensed cryptocurrency exchange operations must be prohibited, and that exchanges like as Binance and OctaFx, among others, should be banned for their unauthorised activities, with commensurate and dissuasive fines imposed.
Meanwhile, a petitioner before the Supreme Court of Canada objected to the proposals.
The committee was ordered by the SHC’s division bench, led by Justice Mohammad Karim Khan Agha, to transmit a copy of the report to the Ministry of Finance and the Ministry of Law.
The ministries will meet to discuss the issue and come to a final conclusion on whether cryptocurrencies, in any form, can be legalised in Pakistan and, if so, what the regulatory structure would be.
The court ordered the Ministry of Finance and the Ministry of Law to issue a joint recommendation on whether cryptocurrency trading in any form is legal in Pakistan, as it was causing difficulties for those who were involved at the time, given the Federal Investigation Agency’s constant raids and freezing of bank accounts.
According to the News International article, the court ordered the Secretary Finance and Secretary Law, as well as other top officers from the Ministry of Law, to appear before it on April 11 and file a report on the matter.
Last Monday, Pakistan’s Federal Investigation Agency discovered an online fraud involving a cryptocurrency worth USD 100 million (Rs 17,587 billion) and sent a notification to Binance, the world’s largest cryptocurrency exchange.
