The State Bank of Pakistan has notified all banks and financial institutions that the longstanding ban on providing services to cryptocurrency firms has been lifted. However, the new regulations stipulate that banks are not permitted to invest in, trade, or hold cryptocurrency using their own funds or customer deposits.
This development follows the recent passage of the Virtual Assets Act of 2026, which established the Pakistan Virtual Asset Regulatory Authority to oversee and regulate the sector. The central bank has replaced its 2018 ban with new guidelines, allowing regulated banks and financial institutions to open accounts for crypto companies licensed under the new act. Banks can provide services to virtual asset service providers, as well as to those seeking approval, provided they comply with strict anti-money laundering, know-your-customer, and counter-terrorism financing regulations. The State Bank of Pakistan has outlined detailed conditions for onboarding crypto firms, including mandatory license verification, enhanced due diligence, and ongoing transaction supervision.
In a recent development, the Pakistani government signed a memorandum of understanding with Binance to explore tokenization opportunities. The country's Virtual Assets Regulatory Authority has also 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 a significant player in the global crypto market.