Pakistan Removes Seven-Year Ban, Permitting Banks to Offer Services to Crypto Firms

The State Bank of Pakistan has announced that it is lifting the ban on banks providing services to cryptocurrency companies. However, banks are still not allowed to invest in, trade, or hold cryptocurrency using their own funds or customer deposits, as per the new regulations. This move follows the recent introduction of the Virtual Assets Act 2026, which established the Pakistan Virtual Asset Regulatory Authority to oversee the sector. The new rules allow licensed banks and financial institutions to open accounts for cryptocurrency firms approved by the regulatory authority, provided they adhere to strict anti-money laundering and know-your-customer regulations. The central bank has outlined detailed conditions for onboarding cryptocurrency companies, including mandatory license verification and ongoing transaction monitoring. This development comes after the Pakistani government signed an agreement with Binance to explore the tokenization of government assets and announced plans to promote cryptocurrency adoption and launch a national stablecoin. Approximately 40 million people in Pakistan, or around 17% of the population, are involved in cryptocurrency trading, making the country one of the largest crypto markets globally.