Crypto banking ban ends in Pakistan as regulated market access opens
The policy shift aims to support regulated digital asset activity while maintaining oversight and financial system stability through controlled banking access.
Pakistan has lifted its eight-year ban on crypto-related banking activity by allowing financial institutions to work with licensed virtual asset providers.
The State Bank of Pakistan (SBP) issued a circular on 14 April authorising regulated banks to open accounts for entities registered under the Pakistan Virtual Assets Regulatory Authority (PVARA), following the passage of the Virtual Assets Act 2026.
The new framework permits banks to provide access to the sector but bars them from using their own capital or customer deposits to trade, hold, or invest in digital assets.
To reduce risk, institutions must use segregated Client Money Accounts to prevent the mixing of operational and client funds, while also complying with foreign exchange, anti-money laundering, and counter-terrorism financing rules.
Banks are required to conduct thorough due diligence on licensed providers, including verifying regulatory status and monitoring activity.
Any suspicious transactions must be reported to the Financial Monitoring Unit, and financial institutions are expected to adjust internal risk models to reflect the volatility of digital assets.
The regulatory shift follows consultations with global industry players and aims to attract compliant trading platforms to Pakistan’s large crypto user base. Authorities are also exploring blockchain-based infrastructure and stablecoin use cases for improving cross-border payments.
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