The State Bank of Pakistan has officially lifted its seven-year ban on providing services to cryptocurrency firms, notifying banks and financial institutions that they are now allowed to offer their services to these companies. However, financial institutions are still barred from using their own funds or customer deposits to invest in, trade, or hold cryptocurrency. This move comes after the introduction of the 2026 Virtual Assets Act, which established the Pakistan Virtual Asset Regulatory Authority to oversee the sector. Under the new regulations, banks can open accounts for cryptocurrency companies that have been licensed by the regulatory authority, provided they adhere to strict anti-money laundering and know-your-customer requirements.
The central bank has outlined detailed conditions for onboarding these companies, including mandatory license verification and enhanced due diligence. Recently, the Pakistani government signed an agreement with Binance to explore tokenizing bonds and commodity reserves, and the country's regulatory authority has announced plans to promote cryptocurrency adoption and launch a national stablecoin. With around 40 million people, or 17% of the population, involved in cryptocurrency trading, Pakistan is one of the largest retail crypto markets globally.