Director-General Dr. Sanaullah Abbasi of the Federal Investigation Agency (FIA) said on Saturday that the agency would approach the Pakistan Telecommunication Authority (PTA) about blocking cryptocurrency-related websites for fraud prevention and money laundering protection.

Dr. Sanaullah Abbasi told the press on Saturday that the FIA was going to ask the Pakistan Telecommunication Authority (PTA) to block crypto websites to prevent money laundering and fraud.

He said, "The SBP officials gave a presentation in the meeting about a regulating mechanism." The statement came as the result of his meeting with senior bank officials of Pakistan's central bank. He had advised banks to avoid making transactions with virtual currencies, as at present, there is no legal framework to prevent their misuse or illegal operations.

Pakistan lacks the regulatory framework for virtual asset service providers that would comply with FATF (Financial Action Task Force) requirements.

The state bank submitted recommendations on the legal framework for cryptocurrency in Pakistan under the direction of the Sindh High Court. It is alleged that over $100 million was defrauded by Pakistani investors through a massive financial fraud supported by apps linked to Binance.

A team has been formed to review and investigate the frauds related to virtual currencies as per the reports and a decision will be soon be made.

The Director-General added that there are hundreds of such websites all over the world that are selling cryptocurrencies and using them to fund terrorism.

Having no consensus in giving virtual currencies a meaningful utility or intrinsic value has caused concerns for governments worldwide, said Abbasi. This challenges the ability of the Central Bank to exercise control over them.

Pavan A

CBW - External Analyst

INDIA