Pakistan Will Not Legalize BitCoins or Crypto-Currencies: State Bank

State Bank of Pakistan, after undergoing a through study of prospects for allowing crypto-currency in the country, is of the opinion that it will not adopt BitCoins or crypto-currency in Pakistan, said Mr. Muhammad Ashraf, Executive Director, State Bank of Pakistan during a panel discussion at ongoing INet Conference in Islamabad.

State Bank Director was responding to a question asked by Mr. Harish Pillay, Global head of Community Architecture and Leadership at Red Hat Inc., who had opined that BitCoin like solutions have ability to completely eliminate the need of a middle-man for financial transactions; additionally crypto currencies are especially viable for remittances as there’s no service charge for during currency transfer.

In response, Mr. Ashraf said that topic of legalizing BitCoins in Pakistan has been discussed and deliberated at State Bank of Pakistan, however, due to obvious reasons — such as that it doesn’t warrant depositor’s interest or the interests of financial institutions —  regulator is currently not considering to legalize crypto currencies in the country.

Yahya Khan, Head of Easypaisa, who was also part of the panel, said that his company has looked at crypto currencies from player’s point of view but Pakistan is currently at least few years behind where anyone could go to an outlet and buy BitCoins.

Mr. Yahya said that there is viable scope of BitCoins in Pakistan, especially for international remittances, but it has to be approved from regulator before BitCoins are allowed and used by masses in Pakistan.

Tech reporter with over 10 years of experience, founder of ProPakistani.PK


    • Here in Australia, some cafes and restaurants take Bitcoin…

      The Reserve Bank here (equivalent to SBP) defines Bitcoin as personal property instead of currency though…so buying things using Bitcoin is treated as a barter exchange.

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  • State Bank should say the real reason i.e. they are too illiterate, brain damaged, old school and stupid to understand crypto currencies. They should be ashamed of their backwardness, No paypal, no bitcoin, not even a squat except the papery junk called PKR.

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  • This “Shatate Bank” has not even allowed PayPal to enter Pakistan. Most debit cards of Pakistani banks do not even work online because gateway is not configured properly and now it gives incentive Bitcoin not allowed because fu**kin government won’t be able to tax that.

    • it depends on bank too. Many bank ask u to call them and ask them to allow u to shop. while others send u call or sms asking u to reply for transaction to proceed.

    • Its not SBP only. Papal is US based. And USA is generally curtailing all money type services to Pakistan. Heck my account at itbit got closed for this very reason.

      • currently what is the legal status of bitcoins regulation? is it considered as a legal tender now? if yes! then under whats laws and regulations? if no! then under what laws we are restricting its regulation.

        • Currently you can trade, buy sell btc but it will not be considered as a legal tender. What that means is that if you pay someone in btc you cant prove that in court. Its under Pakistans 1940’s currency act law it applies to btc as a currency also.

  • Here is why this is a ridiculous statement. First of all, State Bank of Pakistan does not control, regulate, issue, or distribute BitCoins. So they are stating the obvious, we cannot regulate it as yet.

    Secondly, they do not have jurisdiction on it. You can have BitCoins and transfer them into anyother currency of the world and then exchange that amount into PKR.

    BitCoins reside in virtual wallets not in the vaults of banks. BitCoins are not issued by the Banks or a centralized organization. What state bank can do is that they can illegalize it for local banks to convert BitCoin into rupees within Pakistan’s jurisdiction.

    The same banks, if they want, they can exchange bitcoins with PKR outside Pakistan’s jurisdiction and then that exchanged Pakistani currency will be legal.

  • What is bitcoin in the eyes of Pakistan? Is it a currency, a commodity, or a digital asset or just asset? The question is asked by pretty much all countries? The issue here is that SBP has the right to legalize it or declare it illegal only after the Pakistani Government takes a decision under whose jurisdiction bitcoin falls. I went through SBP website to check official notification and I dont see anything regarding declaration of its legality. Additionally any of the paisas would hate bitcoin to be allowed as their income from schemes of easypaisa and upaisa at high premiums will fail.

  • While this article goes into how SBP views bitcoin, it doesnt not declare anything. Another question if you consider bitcoin as a currency in Pakistan, Is it legal to use any other currency in Pakistan other then PKR?

  • Bitcoin is Evolution we need to accept it other then by issue illegal it . we need to go forward and start taking benefit with this currency. SBP didn’t accept it because they know if bitcoin is popular in PK then the banking sector revenue will go down.

  • Only way cryptocurrency can be established in Pakistan will be by backing it with a large real currency fund like having a billion or more dollars bond or cash account established in Pakistan but preferably outside of Pakistan such as in Dubai, USA, EU etc. This bond will be security deposit against the initial purchase of bitcoin or other cryptocurrencies. Pakcoin itself will be a very weak and highly speculative operation due to lack of its real and actual assets in place as suggested above. As an international banker and cryptocurrency investor in USA, I have plenty of banking/investment experience and the expertise to state the facts here. If any entity who can back Pakcoin type of cryptocurrency, then it stands a good chance as an investment platform. Pakistan is highly sophisticated yet doubly highly suspicious and doubting country with a very antiquated and corrupt State Bank controls mired in old fangled British Raj mentality. Cryptocurrency is a fantastic non-State Bank of Pakistan controlled and audited asset for Pakistanis to be free from the corrupt practices of Pakistan taxation, State Bank rules and related hurdles! A China-USA-EU-UAE backed funds based cryptocurrency in Pakistan does stand a very good chance of succeeding as well as freeing people from their blackmails by the Pakistani taxation authorities as well as the corrupt controls by the State Banks!

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