The State Bank of Pakistan has officially lifted its seven-year ban on providing services to cryptocurrency firms, notifying all banks and financial institutions that they can now offer services to these entities. However, the new regulations stipulate that banks are still barred from investing, trading, or holding crypto assets using their own funds or customer deposits. This development follows the enactment of the 2026 Virtual Assets Act, which established the Pakistan Virtual Asset Regulatory Authority to oversee the sector.
The central bank's new framework allows regulated banks to open accounts for crypto companies approved under the authority, provided they adhere to strict anti-money laundering, know-your-customer, and counter-terrorism financing regulations. The rules also outline detailed conditions for onboarding crypto firms, including license verification, enhanced due diligence, and ongoing transaction supervision.
Recent agreements, such as a memorandum of understanding between the government and Binance, aim to explore tokenization opportunities and accelerate crypto adoption in the country, which has a significant crypto market with around 40 million people involved in crypto trading.