Thanks all for the responses. I will leave the PBT in the 7 gallon because honestly, it looks really happy in there. There is a nice live rock cave for him to hide in and as soon as i approach the tank it does a little dance asking me to feed him!
Its currently scarfing down nori, and downing all the formula one pellets i give it.
I will wait till it fattens up and then will reward the PBT with a bigger tank, 72 gallon (not that big, but for a 3inch okay for now).
Will keep you all posted,
Steven