Cryptocurrency remains banned in Pakistan, secretary finance says

Cryptocurrency remains banned in Pakistan and is not recognized as legal tender, Secretary Finance Division Imdadullah Bosal told the National Assembly’s Finance and Revenue Committee on Thursday.

The committee decided to summon Finance Minister Muhammad Aurangzeb, the prime minister’s special assistant on cryptocurrency and blockchain, and members of the Crypto Council for a detailed briefing.

Bosal, briefing the committee chaired by lawmaker Nafisa Shah, said the Crypto Council was established by an executive order from Prime Minister Shehbaz Sharif. The council includes representatives from the Finance Ministry, the State Bank of Pakistan (SBP), the Securities and Exchange Commission of Pakistan (SECP), and other relevant bodies.

However, he stressed that the council is in its early stages and no formal legal or regulatory framework has been introduced yet.

Sohail Jawad, executive director of the SBP, said the central bank has submitted proposals to the Crypto Council regarding cryptocurrency and Bitcoin but emphasized the need for a regulatory framework. He added that only one country had recognized cryptocurrency as legal tender but is now reversing its decision.

Committee member Sharmila Faruqi raised concerns about cryptocurrency’s use in money laundering, terror financing and tax evasion, urging the government to launch public awareness campaigns about the risks.

Another member, Mirza Ikhtiar Baig, warned that investing in cryptocurrencies could lead to significant financial losses. “If the government decides not to accept cryptocurrency in the future, people will lose their money,” he said. He suggested the government issue an official statement clarifying that cryptocurrency is under regulatory review and carries no legal guarantee.

Lawmakers also questioned why the government allocated 2,000 megawatts of electricity for crypto mining despite its illegal status. “What benefit will this electricity allocation bring?” Faruqi asked.

Member Shahram Tarakai warned that without proper regulation, dollars could flow out of the country through unregulated crypto transactions, posing financial risks.

The committee agreed that any regulatory framework must comply with Financial Action Task Force (FATF) guidelines to prevent illicit financial activities.