The State Bank of Pakistan (SBP) has requested the Pakistan Cricket Board (PCB) to devise a code of ethics for its franchises, obligating them to abide by the laws of the land while selecting international sponsors.
In the letter issued by the Exchange Policy Department of the central bank to PCB’s Chief Operative Officer, the central bank said that it has been observed that PCB has engaged Best Fintech Investment Coin (BFIC) as the “Official Technology Partner” of Pakistan Super League (PSL) Season 8.
The central bank said that BFIC is a cryptocurrency and in terms of SBP’s BPRD Circular No. 03 dated April 06, 2018, all Banks/DFIS/ Microfinance Banks and Payment System Operators/ Payment Service Providers have been prohibited from dealing in/promoting virtual currencies.
This represents the regulatory stance of SBP on cryptocurrencies/virtual assets. Therefore, promoting a cryptocurrency through the event of PSL season 8 would not only contradict the aforesaid stance but would also entice the viewers in Pakistan to enter into the prohibited domain of crypto/virtual currencies.
SBP also highlighted that Karachi Kings has signed 1XBAT as Titanium Sponsor. It added that 1XBAT appears to be a surrogate brand of a sports betting website i.e. 1XBET which allows users to bet on a wide variety of popular sports.
The SBP said that apparently, both these websites/domains are foreign-controlled, and thus any usage of their services by resident Pakistanis would result in the outflow of precious foreign exchange of the country. Since, neither these entities nor PCB has obtained any permission from SBP to take out of Pakistan any money earned by them from resident Pakistanis, any transfer of funds from their operations in Pakistan will be in violation of the Foreign Exchange Regulations Act, 1947.
Citing the above, SBP has also requested PCB to ensure that these platforms do not offer any service in Pakistan, which will result in the outflow of funds from Pakistan (even through informal channels).
In its response, a spokesperson of PCB said that BFIC has already been removed as the official technology partner. The spokesperson further said that PCB is strictly against the promotion of alcohol, tobacco, gambling and betting and it is ensured that all sponsors abide by this restriction.
The PCB spokesperson also rejected that 1XBAT is a betting website and said that Pakistan Electronic Media Regulatory Authority (PEMRA) would have stopped Pakistan Television Corporation (PTV) from signing an agreement with 1XBAT if the latter was involved in any dubious activities.