The State Bank of Pakistan has officially lifted its seven-year ban on cryptocurrency services, notifying all banks and financial institutions that they are permitted to provide services to crypto firms. However, banks are still barred from using their own funds or customer deposits to invest in, trade, or hold digital assets.
This development comes after the recent enactment of the Virtual Assets Act of 2026, which established the Pakistan Virtual Asset Regulatory Authority to oversee the sector. The new rules allow regulated banks to open accounts for licensed crypto firms and those seeking approval, provided they adhere to strict anti-money laundering, know-your-customer, and counter-terrorism financing regulations.
The central bank has outlined detailed conditions for onboarding crypto firms, including mandatory license verification, enhanced due diligence, and ongoing transaction supervision. This move follows a memorandum of understanding between the Pakistani government and Binance to explore tokenization opportunities, as well as plans to accelerate crypto adoption and launch a national stablecoin. Approximately 40 million Pakistanis, or 17% of the population, are involved in crypto trading, making the country the third-largest retail crypto market.