Pakistan to Enforce Total Ban on Cryptocurrencies

Pakistan's Stance on Cryptocurrency

Pakistan is set to enforce a complete ban on cryptocurrencies, diverging from countries like Europe and the UAE that are embracing digital currencies. The Pakistani government, led by the Senate Standing Committee on Finance, is preparing legislation aimed at prohibiting the use of cryptocurrencies within its borders. Aisha Ghaus Pasha, the Minister of State for Finance, has confirmed the government's intent to outlaw these digital assets.

Government Actions and Justifications

Efforts to ban cryptocurrencies are already underway with the collaboration of the State Bank and the Ministry of Information Technology. Authorities emphasize that cryptocurrencies will not gain legal status in Pakistan. The Executive Director of the Digital State Bank, Sohail Jabbar, pointed out the sharp decline in the cryptocurrency market, reinforcing the stance that digital currencies are unsustainable and should not be legalized. The Federal Investigation Agency and Financial Monitoring Unit are actively investigating cryptocurrency investments in the country.

Legislative Support and Concerns

Pakistan People’s Party Senator Farooq H. Naik supports punitive measures for cryptocurrency dealings, underlining the necessity for formal legislation. He raised concerns about the potential for cryptocurrencies to facilitate financial terrorism. The proposed ban aligns Pakistan with countries like China, Algeria, Bangladesh, Egypt, and Nepal, which have also prohibited cryptocurrencies due to various risks.

Global Context and Risks

The global apprehension surrounding cryptocurrencies stems from concerns over their use in money laundering, price volatility, and the potential financial losses for investors. The decentralized nature of digital currencies also poses challenges to government control, contributing to Pakistan's decision to pursue a ban.

By taking this step, Pakistan aims to safeguard its financial system from perceived threats associated with cryptocurrencies, prioritizing national security and economic stability over the adoption of digital currencies.