The SHC also advocated fines for “unauthorised operations.”
According to a report given to the Sindh High Court (SHC) on Wednesday, the State Bank of Pakistan and the federal government have agreed to prohibit the usage of all cryptocurrencies.
In the absence of legislation and procedures to oversee the use of these digital currencies for commerce, the position of cryptocurrencies in Pakistan has been in limbo.
On October 20, the Sindh High Court ordered the federal government to regulate cryptocurrencies within three months. According to the court, the government must organise a committee led by the federal secretary of finance to assess the legal status of cryptocurrencies.
The authorities were ordered by the court to provide a report on the usage of cryptocurrencies. On Wednesday, the report was sent to the Sindh High Court.
According to the study, bitcoin is unlawful and cannot be used for trade.
At least eleven nations, including China and Saudi Arabia, have outlawed cryptocurrency, according to the research.
The report also mentions the FIA’s recent inquiries into crypto exchanges, including Binance and OctaFx, as well as the risk these exchanges posed to investors.
The report will be referred to the finance and law ministries for a final determination on the legal status of cryptocurrencies, according to the Sindh High Court.
The law and finance ministries will examine whether a ban on cryptocurrency is permissible under the Constitution. They’d also come up with a legal structure.
The case was heard by a two-member court led by Justice Karim Khan Agha.
The 38-page study, filed by SBP Deputy Governor Seema Kamil, recommends that cryptocurrencies be deemed unlawful.
According to the research, bitcoin is a virtual enterprise that might be used to fund terrorism and money laundering.
During the hearing, a significant point was raised: what would happen to cryptocurrencies in the months before a final judgement is made?
According to the court, the Federal Investigation Agency (FIA) and other agencies, according to the court, will continue to follow their regulations.
It requested the court to prohibit cryptocurrency exchanges from conducting “unauthorised operations” and penalise them “like some other nations have done.”
A petitioner asked the court to declare cryptocurrencies lawful, claiming that a vast number of Pakistanis were interested in them.