Pakistan Bars Banks from Crypto and ICO Trading
A long-running cryptocurrency exchange in Pakistan is closing its door following a new advisory from the country's central bank.
Pakistan's central bank issued a statement barring financial companies in the country from working with cryptocurrency firms, becoming the latest institution of its kind to bar the activity.
In a statement posted to its website (and circulated via social media), the State Bank of Pakistan (SBP) said:
The central bank did not respond to a request for comment. But as of press time, the announcement is already having an impact on the local cryptocurrency scene.
Urdubit, a cryptocurrency exchange that first launched in 2014 with the goal of building a base of support in the region, said in the wake of the statement that it will shut down. Urdubit was the first bitcoin exchange platform to open its doors in the country.
The decision was announced via Facebook, with the startup urging its customers to "please withdraw your funds as soon as possible."
Urdubit's Facebook post included a link to correspondence from the central bank, which including the warning about transactions being tagged as suspicious.
Speaking to CoinDesk, Rodrigo Souza, the co-founder of BlinkTrade (which provided the open-source software that Urdubit has used) argued that the central bank move is aimed at putting the brakes on cryptocurrency investment.
"Governments and Banks are going to fight Bitcoin because investing Bitcoin means a bank run on the central bank," he said, going on to add:
The move comes a day after India's central bank blocked banks from doing business with cryptocurrency exchanges. But as CoinDesk subsequently reported, exchanges in that country are eyeing a legal challenge that could see the dispute argued before India's highest court.
Pakistani rupee image via Shutterstock
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.
Learn more about Consensus 2023, CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.