Why Are Bank Accounts Being Blocked in Pakistan Due to P2P Crypto Trading?
1. P2P Crypto "Chain-Dispute" Scam
In these scams, a fraudster uses a victim’s bank to receive funds and then initiates a dispute claiming the account was hacked or the transaction was unauthorized.
This triggers banks to freeze not only the fraudster’s account but also all downstream accounts that received funds—even from completely innocent users. This cascading effect is known as a “bank chain dispute scam.”
Victims unknowingly become entangled simply by receiving or passing funds through these networks, leading to widespread account freezes.
2. Regulatory Environment: Crypto is Still Banned in Pakistan
Since at least 2018, the State Bank of Pakistan (SBP) has issued circulars prohibiting any entity—including banks, exchange companies, and EMIs—from facilitating transactions involving virtual currencies like Bitcoin. Such transactions must be reported to the Financial Monitoring Unit (FMU) as suspicious.
As of May 2025, both the SBP and Ministry of Finance reaffirmed that cryptocurrency remains banned, and that no legal framework currently permits trading or use of digital assets in Pakistan.
3. Human Accounts and Real Experiences
On Reddit, users shared firsthand accounts:
> “Even if you get sender’s cnic bank statement... you can be trapped in chain dispute... amounts will get on hold for many months and even years.”
“I sold USDT small amount on binance p2p … the seller called back and complained … my bank account got blocked.”
These stories highlight how quickly a single P2P transaction—even with someone who seems legitimate—can trigger long, complicated disputes.
Summary: Why Accounts Get Blocked
Cause Explanation
Chain Dispute Scams Fraud reports cascade through transaction chains, freezing innocent parties.
Regulatory Red Flags Crypto involvement is automatically treated as suspicious under SBP guidelines.
Legal Prohibition With no formal legalization or regulatory framework, any P2P crypto transaction is risky.
Tips to Stay Safe (if you must engage)
Based on expert advice and user experiences:
Don't use your main bank account for P2P crypto; use separate accounts or EMIs like SadaPay, Nayapay, or Easypaisa instead—and avoid transferring back to your main account.
Request detailed proof (e.g., recent account statements, CNIC videos) from your trading partner to ensure they're not involved in any suspicious activity.
Choose trusted, verified merchants with clean transaction histories and positive reviews; conduct trades in small chunks.
Conclusion
Bank accounts in Pakistan are being blocked mainly because:
1. The chain-dispute scam causes innocent users to get swept up in fraudulent P2P transactions.
2. Cryptocurrency transactions are still deemed illegal, raising automatic suspicion under SBP regulations.
Until a formal legal framework emerges—and effective oversight is in place—P2P crypto dealings will remain high-risk in Pakistan.
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