The State Bank of Pakistan has announced the lifting of its seven-year ban on providing services to cryptocurrency companies, allowing banks and financial institutions to offer their services to these firms. However, banks are still barred from using their own funds or customer deposits to invest, trade, or hold cryptocurrency assets. This development follows the introduction of the 2026 Virtual Assets Act, which led to the establishment of the Pakistan Virtual Asset Regulatory Authority (PVARA) to oversee and regulate the sector. The new rules permit regulated banks and financial institutions to open accounts for crypto companies that have been approved by PVARA.
Banks can now provide services to licensed virtual asset service providers (VASPs) and those seeking approval, provided they adhere to strict anti-money laundering (AML), know-your-customer (KYC), and counter-terrorism financing regulations. The State Bank of Pakistan has outlined detailed conditions for onboarding crypto companies, including mandatory license verification, enhanced due diligence, and ongoing transaction supervision. Recently, the Pakistani government signed an agreement with Binance to explore tokenization opportunities, and the country's Virtual Assets Regulatory Authority 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.