Pakistan lifts seven-year ban, allowing banks to service crypto providers
Pakistan sent a letter to all banks and financial regulatory firms notifying them that they may provide crypto services,, but remain barred from trading or holding crypto assets.
What to know:
- Pakistan’s central bank has lifted its blanket ban on crypto services, allowing banks and financial institutions to serve licensed crypto firms under a new regulatory framework.
- While banks may open accounts for virtual asset service providers approved by the Pakistan Virtual Asset Regulatory Authority, they remain barred from trading, investing in or holding crypto with their own funds or customer deposits.
- The move follows the 2026 Virtual Assets Act and comes as Pakistan, already one of the world’s largest retail crypto markets, pursues plans for tokenized state assets, expanded Bitcoin mining and a national stablecoin.
The State Bank of Pakistan’s move follows the recent enactment of the 2026 Virtual Assets Act, which establishes Pakistan’s Virtual Asset Regulatory Authority (PVARA to license, regulate and supervise the sector.
The central bank replaced its 2018 ban on crypto with new rules that permit regulated banks and other financial institutions to open accounts for crypto firms approved under PVARA.
Under the new state bank framework, banks can provide services to virtual asset service providers (VASPs) licensed under the new crypto act, as well as to those seeking approval, subject to strict compliance with anti-money laundering (AML), know-your-customer (KYC), and other counter-terrorism financing regulations.
“Subject to strict compliance with the conditions outlined herein, SBP Regulated Entities (REs) may open bank accounts of entities duly licensed by PVARA as Virtual Asset Service Providers (VASPs),” the State Bank of Pakistan said.
