The State Bank of Pakistan has officially lifted its seven-year ban on providing services to cryptocurrency companies, notifying all banks and financial institutions that they are now allowed to offer their services to these firms. However, banks are still not permitted to use their own funds or customer deposits to invest in, trade, or hold cryptocurrency assets.
This decision follows the recent introduction of the Virtual Assets Act of 2026, which established the Pakistan Virtual Asset Regulatory Authority (PVARA) to oversee and regulate the sector. Replacing its 2018 ban, the central bank has introduced new rules allowing regulated banks and financial institutions to open accounts for cryptocurrency companies that have been approved by PVARA. Under the new framework, banks can provide services to virtual asset service providers (VASPs) that are licensed under the new act, as well as to those seeking approval, provided they comply with strict anti-money laundering, know-your-customer, and counter-terrorism financing regulations.
The State Bank of Pakistan has outlined specific conditions for onboarding cryptocurrency firms, including mandatory license verification, enhanced due diligence, and ongoing supervision of all transactions. This development comes after the Pakistani government and Binance signed a memorandum of understanding to explore the tokenization of up to $2 billion in bonds and commodity reserves. Pakistan's Virtual Assets Regulatory Authority has also announced plans to accelerate cryptocurrency adoption and launch a national stablecoin, with approximately 40 million people, or 17% of the population, already involved in cryptocurrency trading, making the country the third-largest crypto market by retail activity.