Waqar Zaka Says FATF Hasn’t Instructed Pakistan To Ban Cryptocurrency

Waqar Zaka Says FATF Hasn’t Instructed Pakistan To Ban Cryptocurrency

Waqar Zaka Says FATF Hasn’t Instructed Pakistan To Ban Cryptocurrency
  • Waqar Zaka asked FATF whether it asked Pakistan to ban cryptocurrency
  • FATF said it doesn’t require countries to ban cryptocurrency.
  • Finance Minister for State said Pakistan will never legalize crypto.

The Pakistani government recently decided to ban cryptocurrency services in the country to prevent illegal digital currency transactions as per the guidelines of the global financial regualator.

Minister of State for Finance and Revenue Dr Aisha Ghaus Pasha told the Senate Standing Committee on Finance that cryptocurrency will “never be legalized in Pakistan”

Finance Minister for State said Pakistan will never legalize crypto.

Waqar Zaka asked FATF whether it asked Pakistan to ban cryptocurrency

FATF said it doesn’t require countries to ban cryptocurrency.

She said the Financial Action Task Force (FATF) has imposed restrictions. “FATF had set a condition that cryptocurrency will not be legalized,” she maintained.

She added that the State Bank of Pakistan (SBP) and the Ministry of Information Technology have initiated work on banning cryptocurrencies.

Cryptocurrency expert Waqar Zaka also questioned whether the FATF has instructed the government of Pakistan to ban crypto and digital assets.

In a video message, Zaka asked the global financial watchdog to clarify whether it has instructed the Pakistani government over the ban and deprived Pakistani citizens of investment.

He said Dubai is coming the hub of cryptocurrency despite being in the “grey area”. He said the black market is created when there is a blanket ban on a product.

However, it has been reported that the FATF has not instructed the Government of Pakistan to ban cryptocurrency or digital assets to stay off the “grey list”. In October last year, Pakistan was removed from the list of countries considered at high risk of money laundering and terror financing.

In a reply to Coin Desk, a news site specializing in bitcoin and digital currencies, the FATF declined to directly respond to statements made by the finance state minister but said it  does 'not require countries to indiscriminately ban virtual assets and virtual asset service providers.'

It, however, said that 'countries are permitted, but not required, to prohibit virtual assets and virtual asset service providers.'

The FATF said it requires countries to understand money laundering and terror financing risks faced by the cryptocurrency sector and issue licenses or register exchanges to supervise the sector as other financial institutions.

The FATF requires virtual asset service providers to implement the same preventive measures as financial institutions, including customer due diligence, record keeping and reporting of suspicious transactions, and adhere to its travel rule – which requires crypto service providers to collect and share information on transactions above a certain threshold.

The State Bank of Pakistan (SBP) endorsed the ban and said digital currency transactions could disrupt the financial ecosystem. However, there has also been an outcry particularly on social over the decision to ban cryptocurrency.

Pakistan has seen a boom in trading and mining cryptocurrency which flourished until April 2018 when the government imposed a ban. There is still a growing ministry industry despite strict action as most exchanges do not appear on the regulatory radar.

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