SBP (State Bank of Pakistan) is looking into banning all cryptocurrency trading and transactions.
According to reports, Pakistan’s Sindh High Court convened a hearing on the legal status of cryptocurrencies in the nation, during which multiple Pakistani agencies, including the SBP, presented a paper to the court saying that cryptocurrencies such as Bitcoin (BTC) are unlawful and cannot be used for trading.
Samaa TV reported that the paper listed at least eleven nations that have banned cryptocurrency, including China and Saudi Arabia. Authorities in Pakistan allegedly asked the court to penalize bitcoin exchanges and prohibit cryptocurrency trading altogether.
The SBP also mentioned various Federal Investigation Agency (FIA) investigations into crypto exchanges, citing investor protection issues and money laundering and terrorism fears.
As previously reported, the FIA launched a criminal investigation against Binance, the world’s biggest cryptocurrency exchange, in early January, citing a probable connection to a multimillion-dollar cryptocurrency fraud in the area.
Despite the SBP’s recommendation to restrict all cryptocurrency transactions in Pakistan, the Sindh High Court has not yet issued a ban on crypto transactions.
The court ordered that the appeal of the bank be referred to the finance and law ministries, who will determine the legal status of cryptocurrencies in the country and decide whether banning them would be constitutional.
In April 2018, the SBP first prohibited dealing in virtual currencies and tokens. In those days, the central bank argued that cryptocurrencies such as Bitcoin and initial coin offerings were not legal tender and weren’t guaranteed or issued by the Pakistani government.