Pakistan Revokes Seven-Year Crypto Ban, Permitting Banks to Offer Services to Crypto Providers

The State Bank of Pakistan has officially lifted its seven-year ban on providing services to cryptocurrency companies, enabling banks to open accounts for licensed crypto firms. However, financial institutions are still prohibited from directly investing in, trading, or holding cryptocurrency using their own funds or customer deposits. This move follows the recent passage of the Virtual Assets Act of 2026, which established the Pakistan Virtual Asset Regulatory Authority to oversee the sector. Under the new framework, banks can offer services to licensed virtual asset service providers and those seeking approval, provided they adhere to strict anti-money laundering, know-your-customer, and counter-terrorism financing regulations. The central bank has outlined detailed conditions for onboarding crypto firms, including mandatory license verification, enhanced due diligence, and ongoing transaction supervision. This development comes after the Pakistani government signed a memorandum of understanding with Binance to explore tokenizing up to $2 billion in bonds and commodity reserves. The country aims to accelerate crypto adoption, leverage Bitcoin mining, and launch a national stablecoin, with approximately 40 million people, or 17% of the population, already involved in crypto trading.