Another one bites the dust? Pakistan will ban crypto and never legalize it

[bbc.reporter]

The official reason for why the Finance Minister of Pakistan wants to ban and never legalize the cryptospace in their country is to remove Pakistan from a FATF grey list. However, the skeptical me thinks this might not be the only reason. Pakistan has a pending approval for a bailout from the IMF and the IMF does not like crypto hehe.

We also know what has happened to much of these bailouts. The corrupt people at the top enjoy it, while the tax payers at the bottom pay for it very much similar to what the bankers did in the 2007 financial crisis hehehehe.



Cryptocurrencies will “never be legalized in Pakistan,” said Minister of State for Finance and Revenue Aisha Ghaus Pasha to the country's Senate Standing Committee on Finance on Wednesday, according to local reports.

The minister said that the Financial Action Task Force (FATF) had set a condition that cryptocurrency will not be legalized to keep it off the international finance watchdog's so-called "Grey List," according to one local news outlet, and another said Pakistan's stated position is because it goes against the conditions set by the FATF.

Read in full https://www.coindesk.com/policy/2023/05/18/pakistan-announces-fresh-ban-on-crypto-but-adoption-as-a-hedge-remains-popular/



In any case, this is very much the opposite of what Bukele is doing in El Salvador. I used to laugh and shake my head at Bukele because being the skeptical me, I thought he was only larping. I have now come to respect him.

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[mindrust]

So you think the IMF forced Pakistan to ban crypto… But I thought the IMF was a friend to crypto…  then I read this article and I came to my senses

https://www.imf.org/en/Blogs/Articles/2023/02/23/technology-behind-crypto-can-also-improve-payments-providing-a-public-good

Crypto assets have been more of a disappointment than a revolution for many users, and global bodies like the IMF and the Financial Stability Board urge tighter regulation.

…

Central bank role

Central bank digital currencies can help because of their dual nature as both a monetary instrument—a store of value and means of payment—but also as infrastructure essential to clear and settle transactions. Policy discussions have mostly focused on the first aspect, but we believe the second should receive just as much attention.

As a monetary instrument, CBDC provides safety; it alleviates counterparty risks and provides liquidity in payments. But as infrastructure, CBDC could bring interoperability and efficiency among private networks for digital money and even assets.

Payments could be made from one private money to another, through the CBDC ledger or platform. Money could be escrowed on the CBDC platform, then released when certain conditions are met, such as when a tokenized asset is received. And the CBDC platform could offer a basic programming language to ensure smart contracts are trusted and compatible with one another. That too will become a public good in tomorrow’s digital world.

…

Of course these fuckers will want to ban crypto. It is because they want to eliminate any competition. They are fine with stealing all the tech from these open-source projects and then they ban them. That’s now fair.

[Husires]

Legislation follows the interests of citizens, so whenever it is in the interest of citizens to accept bitcoin, the government will not stand against that desire, although I think that Pakistan will be the last country to regulate cryptocurrencies, and therefore its impact will be limited due to the fact that many countries have done so.

Saying that Bitcoin will not be legal does not mean that Bitcoin is illegal or prohibited, and therefore the ordinary user will be a beneficiary, since he does not pay taxes on it and that there are no penalties for it.

[Poker Player]

Legislation follows the interests of citizens,

Where do you get that from?

Do you really believe that the The 1913 Federal Reserve Act, by which The Fed was created was passed as a consequence of the interest of citizens? I don't.

I am not saying that it is not so in all cases, but in other cases, the legislation obeys the interests of pressure groups, voter groups, supranational entities and a long etcetera.
Or the social credit legislation in China. In this case, I do not believe that the legislation Pakistan is going to implement is a consequence of the interests of the citizens but rather obeys the interests of politicians, who are more in favor of CBDCs because they can control them.

[zasad@]

Legislation follows the interests of citizens,

Where do you get that from?

Do you really believe that the The 1913 Federal Reserve Act, by which The Fed was created was passed as a consequence of the interest of citizens? I don't.

I am not saying that it is not so in all cases, but in other cases, the legislation obeys the interests of pressure groups, voter groups, supranational entities and a long etcetera.
Or the social credit legislation in China. In this case, I do not believe that the legislation Pakistan is going to implement is a consequence of the interests of the citizens but rather obeys the interests of politicians, who are more in favor of CBDCs because they can control them.

For many years the bankers wanted a legitimate way to run the government, so they introduced the Federal Reserve System in the US. It is the same in all countries, central banks are not subordinate to the government. Kennedy wanted to change that, and he was assassinated. In Russia, Putin wanted to subordinate the Central Bank to the government, but he did not succeed (this was at the beginning of his career).
The situation is similar in other countries.
Of course, such legislation is applied in the interests of the ruling class.

[Fiatless]

Legislation follows the interests of citizens, so whenever it is in the interest of citizens to accept bitcoin, the government will not stand against that desire, although I think that Pakistan will be the last country to regulate cryptocurrencies, and therefore its impact will be limited due to the fact that many countries have done so.

I don't know the country you are from but in my country, the political class makes policies to fill their pockets and not for the good of the masses. The people desire to be free to make their choices in financial matters. But the government will always want to control its citizens to take more money from them through diverse means.

Pakistan might not be the last country to regulate cryptocurrency. Many countries still rely on IMF and the World Bank for financial assistance. And it is becoming very clear every day that one of the major criteria to access loans and grants is to stay clear of cryptocurrencies.

[SamReomo]

Legislation follows the interests of citizens, so whenever it is in the interest of citizens to accept bitcoin, the government will not stand against that desire, although I think that Pakistan will be the last country to regulate cryptocurrencies, and therefore its impact will be limited due to the fact that many countries have done so.

Legislation doesn't follows the interests of citizens in Pakistan. There are many enthusiasts and lovers of Bitcoin in Pakistan and some people like Waqar Zaka have been trying their best to legitimize crypto-currencies and particularly Bitcoin in the country, but the political powers do not listen to the ones whom they dislike. The voice of Waqar Zaka and many other enthusiasts is ignored by the political powers of the country and thus no one even takes any good actions regarding legitimization of the crypto-currencies.

The situation is different this time in the country because when IMF and FATF orders anything to Pakistan, the government of Pakistan obeys it without rethinking. The government mainly does that because there's a lot of debt on it because they have taken many loans from IMF, and the other reason is the FATF.  The FATF has kept Pakistan in Blacklist for many years and now they're keeping it in grey list, the government's initiative is to get is accepted in the whitelist and for that they will do anything that would make them to have a place in that list.

[nutildah]

In any case, this is very much the opposite of what Bukele is doing in El Salvador. I used to laugh and shake my head at Bukele because being the skeptical me, I thought he was only larping. I have now come to respect him.

This is a good point... I initially thought Bukele just got taken advantage of by social media influencers but (I'm pretty sure anyway) someday investing heavily in Bitcoin and related infrastructure will pay off for El Salvador. He had the balls to do something completely different, totally outside the norm for a world leader, and that's commendable.

Banning crypto in 2023 is just a way to backwardize your citizens, an example of the state putting their own interests above those of the people.

Pakistan's rupee slid 3.3% to an all-time low against the dollar of 300 per greenback last week, Bloomberg reported...

"I suspect that many people are buying USDT on crypto platforms as a way to get exposure to the US dollar," (chairman of KTrade Securities, Khwaja) said. "Even Bitcoin has performed well against the Pakistani Rupee. During the crypto run, reportedly more than 20 million Pakistanis had opened accounts on crypto platforms."

[bbc.reporter]

@nutildah. The only problem of Bukele is being very open on his support for bitcoin by making it legal tender. This has caused him much problems with the IMF because it put the government of El Salvador in a position where it cannot get more cashflow but the IMF can lobby on policies because of cashflow given in the past.

In any case, I am skeptical of this new adviser hehehe. What is a former IMF official advising on the government of El Salvador?



El Salvador has tapped a former International Monetary Fund official as an adviser as it seeks a deal with the multilateral lender, according to people familiar with the matter.

Alejandro Werner, who retired as head of the Western Hemisphere Department at the IMF in 2021, has been working with the Central American nation’s government this year, according to the people, who asked not to be identified because the matter is private.

Source https://www.bloomberg.com/news/articles/2023-04-17/former-imf-official-werner-said-to-advise-el-salvador-on-deal



Another problem for Bukele is the election on February 2024. His political rivals will certainly get the funding from the bankers outside and inside El Salvador.

[joniboini]

Saying that Bitcoin will not be legal does not mean that Bitcoin is illegal or prohibited, and therefore the ordinary user will be a beneficiary, since he does not pay taxes on it and that there are no penalties for it.

If you read further into the article shared by OP, I think their stance on crypto is quite clear (if the report is accurate). They really want people to stop buying/trading crypto by banning their bank accounts if they ever use it to deposit on exchanges and make trades. Not sure how they will try to stop P2P though. Maybe they will try to ban P2P websites but offline trading or trading via other platforms like this forum might still work.

[yhiaali3]

This is my opinion about the International Monetary Fund from a long time ago. It is just a pressure tool in the hands of powerful governments and large global banks. This method they use is old and well-known. They give poor countries large debts that they are unable to pay, then control their policies and impose on them the conditions they want.

Pakistan fell into this trap because of its great political corruption. The great Pakistani politicians are the beneficiaries of all this and fill their pockets with corrupt political money while the Pakistani people suffer from poverty.

Bitcoin and cryptocurrencies have opened a window to some financial freedom for many poor people around the world, but this does not appeal to governments, central banks or corrupt politicians.

[avikz]

Lol! Pakistan is already facing a huge amount of unemployment issue. Private industries are almost non existent due to the political scenario. Yet the government has the guts to ban something which has the power to provide alternate income source to their people! That's hilarious!

The kind of political turmoil is ongoing in Pakistan, crypto should sit at the lowest level of their priority list. Not sure why the Finance minister of Pakistan is doing constructive things rather banning cryptos!

[bbc.reporter]

Saying that Bitcoin will not be legal does not mean that Bitcoin is illegal or prohibited, and therefore the ordinary user will be a beneficiary, since he does not pay taxes on it and that there are no penalties for it.

If you read further into the article shared by OP, I think their stance on crypto is quite clear (if the report is accurate). They really want people to stop buying/trading crypto by banning their bank accounts if they ever use it to deposit on exchanges and make trades. Not sure how they will try to stop P2P though. Maybe they will try to ban P2P websites but offline trading or trading via other platforms like this forum might still work.

I am beginning to speculate that the reason why the govenment of Pakistan wants to impose a strict ban on the cryptospace is because their financial system is highly used by some groups for terrorist financing. I reckon maybe one of the highest in the whole of Asia and they do not want to complicate this by having the cryptospace enter this.

However, they have a bigger problem. It will be very hard for the government to enforce any type ban outside of on and off ramps. People can trade very much similarly like they do in China.

[joniboini]

However, they have a bigger problem. It will be very hard for the government to enforce any type ban outside of on and off ramps. People can trade very much similarly like they do in China.

True, but I believe it will definitely get harder for the average joe to trade Bitcoin, especially if they're not familiar with P2P trades before. I won't be surprised if some users decide to stop using crypto if they don't want to even try P2P trading. Maybe we can encourage them or give them help, but it is not possible if they don't even use this forum.

Since the main reason they decide to impose a ban is to avoid getting sidelined by other major orgs, I guess we just need to see when the superpower decides the time to pump their bags has come and slowly allow retail to use crypto again.

[bbc.reporter]

@joniboini. It might be harder on adoption, however, for those who really want or need to use it will certainly find a way to have some of it. In China I read articles that people from Hong Kong sell hardware wallets with stablecoins to the people from the mainland. The Chinese inside the mainland use VPNs and other privacy tools and trade their illegaly bought stablecoins through DeFi and decentralized exchanges.

It is very much underestimated that many people want to have any type of participation in the cryptospace hehehe.

[joniboini]

In China I read articles that people from Hong Kong sell hardware wallets with stablecoins to the people from the mainland. The Chinese inside the mainland use VPNs and other privacy tools and trade their illegaly bought stablecoins through DeFi and decentralized exchanges.

That's news to me. I guess the same thing will happen with Pakistan users if the ban goes through. I doubt the police will actively try to imprison those people if they don't transact in a large amount of money, or engage in illegal activities explicitly. What I can see is a crackdown on business since they can earn more there.

[bbc.reporter]

@joniboini. I reckon the reason that those type of activities occur under a strictly regulated jurisdiction is because they need to move large amounts of money and to take part in what has become illegal activites. However, yes I agree that small minnows might not be the regulators of Pakistan's predominant targets. But they might do it in the beginning for media purposes and fear tactics hehe.

[zasad@]

In China I read articles that people from Hong Kong sell hardware wallets with stablecoins to the people from the mainland. The Chinese inside the mainland use VPNs and other privacy tools and trade their illegaly bought stablecoins through DeFi and decentralized exchanges.

That's news to me. I guess the same thing will happen with Pakistan users if the ban goes through. I doubt the police will actively try to imprison those people if they don't transact in a large amount of money, or engage in illegal activities explicitly. What I can see is a crackdown on business since they can earn more there.

Business will always find a way to get around the restrictions, look at Russia, which is leading in terms of sanctions. The prohibition policy does not work, you can easily open a company in the Emirates and engage in legal activities or use the services of decentralized exchanges.
Moscow has the largest shadow market for cryptocurrencies. If you tell me another place where you can exchange tens of millions of dollars for cryptocurrencies in a day and back without problems without documents, I will be grateful.
This works because there are certain agreements between illegal money changers with the police and other agencies. If they close these illegal exchangers, then in a month there will be others that will work on safer protocols, through hiding places, couriers and will not cooperate with the police. The number of crimes will only increase.

[Gozie51]

therefore the ordinary user will be a beneficiary, since he does not pay taxes on it and that there are no penalties for it.

The ordinary people may not freely deal on bitcoin in the first place if the Pakistan government have decided to make it illegal. So it will be like passing through the eyes of a niddle in that environment for someone who is bitcoin friendly to live or don't you think that the government there will frustrate investment in bitcoin there unlike places like El Salvador. 

The effect of such policy is that the people could start moving out to other countries, they can find there way to Haiti, Dominica at least these countries are not having restrictions for bitcoin that I'm aware of, for example binance and kraken exchange operate in Haiti.

[bbc.reporter]

News update.

It appears I was wrong hehehe. The real cause why Pakistan received a surpise bailout from the IMF has been exposed. It is because of the assistance from the Biden administration. But this does not come without a secret agreement with the Americans hehe. Pakistan agreed to secretly help move military equipment to supply Ukraine.



SECRET PAKISTANI ARMS sales to the U.S. helped to facilitate a controversial bailout from the International Monetary Fund earlier this year, according to two sources with knowledge of the arrangement, with confirmation from internal Pakistani and American government documents. The arms sales were made for the purpose of supplying the Ukrainian military — marking Pakistani involvement in a conflict it had faced U.S. pressure to take sides on.

Source https://theintercept.com/2023/09/17/pakistan-ukraine-arms-imf/