A Deep Dive into Pakistan’s Crypto Ban
In a surprising announcement that left many in the local crypto community in turmoil, Pakistan’s Minister of State for Finance and Revenue, Aisha Ghaus Pasha, recently dropped the crypto bombshell: the country plans to ban cryptocurrency services outright. During a Senate Standing Committee session on Finance and Revenue, she cited a mandate from the Financial Action Task Force (FATF) as a driving force behind this decision.
What Sparked the Ban?
The FATF’s gray list brings with it a certain pressure; countries found lacking in anti-money laundering and counter-terrorist financing ventures may feel the heat to comply. With Pakistan recently escaping that gray list in October, officials seem eager to show their commitment to international standards by putting crypto on the chopping block.
Officials Weigh In
Supporting the ban were other notable figures, including the State Bank of Pakistan (SBP) Director Sohail Jawad. According to multiple reports, both the SBP and the Ministry of Information Technology are working diligently on drafting the legislation necessary to enforce the ban. Sounds like a busy week in Parliament!
Public Outcry and the Crypto Community’s Response
But the government’s plans have faced stiff criticism from the crypto community in Pakistan. Twitter erupted with comments decrying the ban, with users like Daniyal Azam urging the government to tackle scams instead of banning a growing financial avenue. Others, like Crypto Arena, voiced a sentiment of loss, saying, “People are making handsome income with crypto trading and the government wants to take this last hope from the poor people of Pakistan.”
It seems there’s a belief in the community that the focus should shift from banning crypto to safeguarding against scams—a sentiment echoed by others who suggested the blame for the ban lies squarely on the IMF’s and FATF’s shoulders.
The Political Landscape and Economic Implications
While FATF lacks the authority to impose sanctions directly, its evaluations influence both governmental and corporate decisions across the globe. As Pakistan’s economy limps under heavy strains and bailout talks with the IMF become increasingly intense, presenting a clean report card to the FATF could seem paramount to the politicians at the helm.
Where Do We Go from Here?
Despite the looming ban, it’s worth noting that crypto adoption in Pakistan has been quite significant, with estimates suggesting that residents held about $20 billion worth of cryptocurrencies in 2021. However, the SBP has expressed its intent to ban crypto trading since as early as January 2023. On a brighter side, Pakistan is looking to introduce a Central Bank Digital Currency (CBDC) by 2025 and has already implemented a national blockchain Know Your Customer platform that may hint at a future where blockchain technology and regulation can coexist peacefully.
“Whatever happens in this country, according to the officials, it’s either IMF’s fault or FATF’s.”
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