The State Bank of Pakistan has officially lifted its ban on providing services to cryptocurrency firms, notifying all banks and financial institutions of the change. However, the new regulations stipulate that banks are not allowed to use their own funds or customer deposits to invest in, trade, or hold crypto assets. This move follows the recent introduction of the Virtual Assets Act of 2026, which established the Pakistan Virtual Asset Regulatory Authority to oversee the sector.
The central bank has replaced its 2018 ban with new rules permitting regulated banks to open accounts for crypto companies licensed under the new act. These banks can provide services to licensed virtual asset service providers, as well as those awaiting approval, provided they adhere to strict anti-money laundering, know-your-customer, and counter-terrorism financing regulations. The State Bank of Pakistan has outlined specific conditions for onboarding crypto firms, including license verification, enhanced due diligence, and ongoing transaction supervision. Recently, the Pakistani government signed an agreement with Binance to explore tokenizing up to $2 billion in bonds and commodity reserves.
Additionally, the Chairman of Pakistan's Virtual Assets Regulatory Authority announced plans to accelerate crypto adoption, promote Bitcoin mining, and introduce a national stablecoin. With approximately 40 million people, or 17% of the population, involved in crypto trading, Pakistan is the third-largest retail crypto market, surpassing countries like Germany and Japan.