The State Bank of Pakistan has announced the lifting of a seven-year ban on providing services to cryptocurrency firms, allowing banks and financial institutions to offer their services to crypto businesses. However, these institutions are still barred from using their own funds or customer deposits to invest in, trade, or hold cryptocurrency. The move follows the introduction of the 2026 Virtual Assets Act, which established the Pakistan Virtual Asset Regulatory Authority (PVARA) to oversee the sector. Under the new framework, regulated banks can 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 license verification and enhanced due diligence. This development comes after the Pakistani government signed an agreement with Binance to explore tokenization and announced plans to accelerate crypto adoption and launch a national stablecoin.
With approximately 40 million people, or 17% of the population, involved in crypto trading, Pakistan is the third-largest crypto market by retail activity.