Urdubit, one of Pakistan’s leading cryptocurrency exchanges, has shut down after the country’s central bank issued a ban which prohibits banks and payment providers from dealing in digital currencies.
On April 6, the State Bank of Pakistan (SBP) announced that cryptocurrencies are not legal tender and that all financial institutions in the country are henceforth banned from “processing, using, trading, holding, transferring value, promoting and investing” in digital currencies. In addition, they are also prohibited from facilitating all crypto-related transactions.
Following the announcement of the SBP, Urdubit, which was founded in 2014 and brands itself as Pakistan’s “first Bitcoin exchange”, began urging its customers via social media platforms (Twitter and Facebook (NASDAQ:FB)) and its official website to immediately withdraw all funds before the exchange shuts down.
Today, Urdubit confirmed that it has officially ceased all operations and will not be entertaining any further requests for withdrawal, although customers are welcome to contact the exchange via email if they have any further issues/concerns.
Speaking to Cryptovest, an Urdubit official who chose to remain anonymous confirmed the following:
“Urdubit has been shut down as per the SBP’s notice. We did not want to be in a position where we would not be able to honor our commitment to our customers, and had to act in haste after the notice was issued, as our bank accounts were in the process of being closed … all our systems are now closed and customers’ commitments have been honored.”
The source also went on to point out that the SBP – much like the Reserve Bank of India (RBI) in the neighboring country – did not provide any prior notice before issuing the crypto ban, leaving exchanges scrambling to ensure that all customers withdraw funds before they close shop.
Speaking on the scenario at present, the Urdubit official stated:
“The banks have been clearly instructed not to process any transaction and report it accordingly to the proper authorities. In this regard we have approached the SBP, as we want to work within the confines of the law and with the regulators.”
However, at present there appear to be no signs of leniency from the central bank on this matter.
The development comes in the midst of a difficult time for cryptocurrencies, as governments and central banks worldwide tighten the noose around digital currencies. The SBP’s ban came one day after the RBI’s announcement, following which two of India’s largest crypto exchanges also halted operations.
This article appeared first on Cryptovest
