- Pakistan allows banks to serve licensed crypto firms after years of restriction
- Only PVARA-approved companies gain access to formal financial services
- Banks remain barred from holding or trading crypto assets directly
Pakistan has finally shifted its stance on crypto, and it’s a pretty big one, honestly. After nearly eight years of regulatory hesitation, the State Bank of Pakistan has reversed its 2018 position, now allowing banks to open accounts for licensed crypto companies under the new Virtual Assets Act 2026.
For a country with around 27 million crypto users operating in a sort of grey zone, this move feels less like innovation and more like catching up with reality. It’s not sudden adoption, but rather a controlled step toward bringing an already massive informal market into the system.
What the New Rules Actually Allow
Under the updated framework, banks can now work with crypto firms, but only if those companies are properly licensed by the Pakistan Virtual Asset Regulatory Authority, or PVARA. That means the door is open, but not wide open, unregistered players are still locked out entirely.
There’s also a clear compliance layer built in, with banks required to carry out enhanced due diligence, monitor transactions closely, and report anything suspicious under anti-money laundering rules. It’s structured, maybe even a bit strict, but that’s probably the point.
What Banks Still Cannot Do
Even with this shift, Pakistan isn’t letting banks jump fully into crypto markets. Financial institutions are still prohibited from holding, trading, or investing in digital assets using their own capital or customer deposits.
So while crypto firms can now access banking rails, banks themselves remain on the sidelines when it comes to direct exposure. It’s a cautious balance, allowing infrastructure to develop without opening the door to speculation at the institutional level.
A Long-Overdue Move Toward Formalization
With around 100 million unbanked adults and an estimated $25 billion in crypto transactions processed in 2025, mostly outside formal channels, the need for regulation has been building for years. This shift isn’t just about policy optics, it’s about bringing real economic activity into a trackable system.
The challenge now is whether PVARA can keep up with demand for licensing as more firms try to enter the regulated space. If it can, Pakistan might finally turn its massive crypto usage into something more structured, and maybe even more sustainable over time.
