Pakistan has officially taken a major step toward embracing the digital financial future by ending its long-standing restrictions on crypto-related banking services. After nearly eight years of limitations, the State Bank of Pakistan has lifted the ban, marking a significant shift in the country’s financial and regulatory landscape.
This development comes alongside the introduction of the Virtual Assets Act 2026, a comprehensive framework designed to regulate the use, trading, and management of digital assets. The new law aims to bring structure, transparency, and security to Pakistan’s growing interest in cryptocurrency and blockchain technologies.
Under the updated regulations, banks are now allowed to open and maintain accounts for licensed Virtual Asset Service Providers (VASPs). This move is expected to improve financial access for crypto businesses, enabling smoother operations and encouraging innovation within the sector.
To ensure proper oversight, a new regulatory authority called Pakistan Virtual Assets Regulatory Authority (PVARA) has been established. This body will be responsible for supervising all crypto-related activities in the country, enforcing compliance, and protecting investors.
Despite opening the doors to crypto services, the framework maintains strict safeguards. Banks are prohibited from directly trading or investing in cryptocurrencies, reducing systemic financial risks. Additionally, VASPs are required to keep client funds separate from company assets, a measure aimed at increasing transparency and preventing misuse of customer funds.
Overall, this policy shift signals Pakistan’s cautious but progressive approach toward digital assets—balancing innovation with regulation, and opening new opportunities for the financial and tech sectors while maintaining strong risk controls.