TL; DR Breakdown
- The government of Pakistan took hold of bank accounts involved in cryptocurrency. It also disabled associated credit cards.
- The government has only restricted cryptocurrency trade, yet, it is not banned.
The government of Pakistan took hold of scores of bitcoin merchants’ bank accounts and credit cards. They used the cards to execute deals valued at about $300,000. As per the local press, those deals involved crypto transactions on prominent exchanges.
According to the Pakistan Observer, the country’s Federal Investigation Agency seized 1,064 accounts. Again the outlet said the authorities took that action following a petition. It links Islamabad’s Cyber Crime Reporting Center (CCRC) with that appeal.
Officials believe the accounts handled transactions amounting to about $288,000. Again, those trades took place between individuals and several cryptocurrency exchanges. The expose saw leading sites like Coinbase, Binance, and Coinmama caught up in the scandal.
The news outlet also wrote that the authorities had disabled credit cards belonging to the affected individuals. It also reminded citizens of an earlier directive on cryptos. Around April 2018, the Central Bank of Pakistan gave a charge censuring the BTC trade through its Financial Policy Enforcement Unit.
Despite the directive, traders in the region have favored cryptos such as bitcoin. Estimates indicate that Pakistanis own cryptos worth about $20 billion. That’s according to the Federation of Pakistan Chambers of Commerce and Industry (FPCCI).
FPCCI chairperson Nasir Hayat Magoon made that revelation in a recent news briefing. He said they were basing their estimates on the value of cryptos held by the citizens on a study by the institution’s Policy Advisory Team.
Magoon further noted that most Pakistanis are getting those coins via peer-to-peer exchanges. Most of those exchanges are unstructured and lack transaction records. Thus the actual crypto ownership might be higher.
Moreover, he urged the assembly to impose rules to govern and ease crypto-related activities. He pointed to India that had already set some regulations in that space. The FPCCI advocates for creating a legislative structure on crypto based on the advice of global agencies, including the FATF and the IMF.
No Crypto Ban in Pakistan
The Pakistani Public Bank has stated that bitcoin is not prohibited. The bank’s lawyer told the High Court that the bank cautioned dealing with digital assets. But it did not outrightly prohibit it.
In an April 6, 2018 memo, the nation’s reserve bank directed banks and fintech to avoid facilitating crypto transactions. They were to cease executing, using, trading, retaining, moving value, advocating, and dealing in digital assets. Besides, they were to steer clear of clients trading in VCs/ICO coins and flag any activity in this respect as unusual.
This directive is identical to one released by India’s reserve bank. The decree banned crypto businesses from banking. However, in March, India’s highest court overturned that directive.