FATF Denies Crypto Is The Cause Of Pakistan’s Grey List: Report

Key Points:

• FATF said it does not require Pakistan to ban virtual assets and virtual asset service providers indiscriminately.
• Earlier, the country’s Minister of State for Finance and Revenue, Aisha Ghaus Pasha, told the country’s Senate Standing Committee on Finance that cryptocurrencies will “never be legalized in Pakistan.”

According to CoinDesk, The Financial Action Task Force (FATF) told the news site in an email that it does “not require countries to indiscriminately ban virtual assets and virtual asset service providers,” despite Pakistan’s finance minister reportedly saying the global money-laundering watchdog had set such a condition for the South Asian country.

Previously, a local news outlet reported that the country’s Minister of State for Finance and Revenue, Aisha Ghaus Pasha, stated that the Financial Action Task Force (FATF) – an intergovernmental body founded by the G7 – made it a condition to keep the country off the “grey list” of countries flagged as of concern due to less-than-perfect records on Anti-Money Laundering and Counter-Terrorist Financing.

According to the FATF, nations must grasp the money laundering and terrorist financing dangers that the crypto sector confronts and issue licenses or register exchanges in order to monitor the sector in the same manner that it supervises other financial institutions.

Another local media reported that Pasha informed the country’s Senate Standing Committee on Finance that cryptocurrencies would “never be legalized in Pakistan.”

The comment by Pakistan’s Pasha was seen as a new prohibition on cryptocurrency by the Pakistani government, despite the nation’s economic suffering, in part because of a turbulent political climate. Pasha is also said to have instructed officials to begin work on a cryptocurrency prohibition.

The FATF requires virtual asset service providers to take the same preventive measures as financial institutions, such as customer due diligence, record keeping, and reporting of suspicious transactions, as well as follow its travel rule, which requires crypto service providers to collect and share information on transactions exceeding a certain threshold.

To date, cryptocurrencies have been considered illegal and unregulated under Pakistani law. Pakistan’s central bank, SBP, has proposed that cryptocurrency be banned in January 2022, and the government has often stated anti-crypto sentiments, despite the fact that adoption has become widespread in the nation.

Chain Analysis, a blockchain data company, rated Pakistan third in its Global Crypto Adoption Index in late 2021. When the SBP proposed the ban, it slid to the sixth position in 2022.

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Harold

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