Pakistan Ends Bitcoin Crypto Banking Ban
Pakistan Ends Bitcoin Crypto Banking Ban
Pakistan has ended its ban on banking services for cryptocurrency firms, allowing licensed virtual asset service providers (VASPs) to access the financial system. Pakistan ends bitcoin crypto banking ban, opening doors to regulated businesses.
Regulatory Framework
The State Bank of Pakistan has announced a new legal framework, enabling banks to provide basic financial services to crypto firms. Strict safeguards are in place to mitigate financial risks and ensure compliance with anti-money laundering (AML) and counter-terrorism financing standards.
Key Requirements
- Banks must verify that entities are licensed by the Pakistan Virtual Assets Regulatory Authority (PVARA)
- Full due diligence and updated risk profiles for VASP clients are required
- Suspicious transactions must be reported to regulators
Virtual Assets Act 2026
The new rules follow the enactment of the Virtual Assets Act 2026, marking the country's first structured move to integrate digital asset businesses into its formal financial system. Bilal bin Saqib, chairman of PVARA, stated that this is a foundational step in bringing virtual assets into the formal financial system of Pakistan.
Investment Restrictions
However, banks are explicitly barred from investing in, trading, or holding cryptocurrencies using either their own capital or customer deposits. Their role is limited to facilitating payment rails and custody of fiat funds tied to licensed crypto activity.
Key Takeaways
- Pakistan has ended its ban on banking services for cryptocurrency firms
- Licensed VASPs can access the financial system, with strict safeguards in place
- Banks are barred from investing in or holding cryptocurrencies
- The country is positioning itself as a regulated hub for digital asset innovation
Frequently Asked Questions
What is the current state of crypto regulation in Pakistan?
Pakistan has ended its ban on banking services for cryptocurrency firms, allowing licensed VASPs to access the financial system.
Can banks invest in cryptocurrencies in Pakistan?
No, banks are explicitly barred from investing in, trading, or holding cryptocurrencies using either their own capital or customer deposits.
