The State Bank of Pakistan has officially lifted its seven-year ban on providing services to cryptocurrency firms, allowing banks to offer their services to these companies. However, banks are still not allowed to invest in, trade, or hold cryptocurrencies using their own funds or customer deposits, as per the new regulations. This move comes after the recent enactment of the 2026 Virtual Assets Act, which established the Pakistan Virtual Asset Regulatory Authority (PVARA) to oversee the sector. The new rules permit regulated banks to open accounts for crypto firms licensed by PVARA, as well as those seeking approval, provided they comply with anti-money laundering and know-your-customer regulations.
The central bank has outlined strict conditions for onboarding crypto firms, including mandatory license verification and enhanced due diligence. This development follows a memorandum of understanding between the Pakistani government and Binance to explore tokenization opportunities, as well as plans to accelerate crypto adoption and launch a national stablecoin.
With around 40 million people, or 17% of the population, involved in crypto trading, Pakistan is the third-largest crypto market by retail activity.