Cryptocurrency not legal tender, SBP informs SHC

KARACHI: The Sindh High Court (SHC) on Wednesday took up a petition challenging a ban on the use of digital currency in the country and directed the federal government, the State Bank of Pakistan (SBP) and the Federal Investigation Agency (FIA) to submit their detailed reply in the case on November 5.

Justice Muhammad Iqbal Kalhoro, who headed the bench hearing the case, resented the SBP prohibiting the use of cryptocurrency, saying Pakistan still lags behind the rest of the world in using modern technology.

Why is cryptocurrency outlawed in Pakistan when it is being used globally, he questioned. To this, an SBP lawyer replied that there is no ban on it in Pakistan but it has not been regulated.

Justice Kalhoro further asked why cryptocurrency has not yet been regulated. “If using digital currency doesn’t constitute an unlawful act, why is it not being allowed?”

The court directed the authorities to place on record international laws regarding cryptocurrency.

In a written reply submitted in the case, the central bank opposed the use of digital currency in the country saying it has already issued an advisory warning against trade in virtual currency as it is not legal tender.

The petitioner stated that the State Bank imposed a ban on the use of digital currency on April 6, 2018 despite that developing countries are earning significant revenue from the cryptocurrency which doesn’t pose any threat to national interests.