Another U-Turn on Crypto ban in Pakistan as State Bank clarified digital assets are not illegal as authorities are pushing government-backed strategic Bitcoin reserve, marking a dramatic shift in its stance on cryptocurrencies.
The central bank clarified it has never declared virtual assets (VAs), including cryptocurrencies, as illegal in the country. The central bank issued statement emphasizing that its previous advisory, which directed financial institutions to avoid dealings with virtual assets, was intended purely as a precautionary measure to protect regulated entities and their customers.
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This statement comes after recent confusion during a briefing to the National Assembly’s Standing Committee on Finance, where it was suggested that cryptocurrency trading and holding are banned in Pakistan. The committee was informed that entities involved in crypto activities are required to report transactions to the Financial Monitoring Unit (FMU), which refers suspicious cases to the Federal Investigation Agency (FIA) for investigation.
SBP said previous advisory remains in effect but highlighted that SBP is collaborating with the Finance Division and the newly established Pakistan Crypto Council (PCC) to formulate a comprehensive regulatory and legal framework for cryptocurrencies.
The development comes as Finance Secretary maintained that cryptocurrencies are currently banned in Pakistan and warned that those involved in crypto transactions may face scrutiny from enforcement agencies.
The formation of the Pakistan Crypto Council has sparked questions regarding its establishment without parliamentary or SBP consultation. The finance secretary explained that the PCC was created under executive orders from Prime Minister Shehbaz Sharif and serves in an advisory capacity to guide future legislation and regulation.
