Pakistan’s crypto banking rules have moved into a new phase after the State Bank of Pakistan allowed financial institutions to open accounts for licensed virtual asset service providers. The decision follows the Virtual Assets Act, 2026, and marks the first formal step to bring regulated crypto-related businesses into Pakistan’s banking system under strict compliance controls.
The State Bank said the new law established the Pakistan Virtual Asset Regulatory Authority, or PVARA, as the statutory body responsible for licensing, regulating, supervising, and overseeing virtual asset activities in the country.
The central bank also revoked its earlier 2018 instructions, which had said virtual currencies, coins, and tokens were not legal tender and directed financial institutions to avoid dealing in them.
Pakistan Crypto Banking Rules Set New Conditions
Under the new framework, banks must independently verify a provider’s PVARA licence before offering any service. They must also keep a copy of that valid licence on record.
In addition, banks must open separate Pakistani rupee-denominated client money accounts for VASP-related transactions where required by the business model. The rules strictly ban commingling company funds with client funds and prohibit using those accounts as collateral.
Entities operating under a PVARA no-objection certificate may only receive limited banking services. Full services will remain available only to fully licensed providers.
Compliance And AML Checks Remain Central
The new policy does not remove existing compliance obligations. Banks will still remain subject to anti-money laundering and counter-terrorism financing requirements, including enhanced due diligence, risk profiling, and suspicious transaction reporting to the Financial Monitoring Unit.
That means the policy opens the door to banking access, but only within a tightly controlled regulatory environment. In effect, Pakistan is trying to formalise crypto-related activity without relaxing oversight.
Bilal bin Saqib, chairperson of PVARA, said the framework would help bring virtual assets into the formal financial system by enabling regulated access to banking channels and strengthening compliance standards.
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The decision was Pakistan’s first formal integration of licensed virtual asset businesses into the regulated banking system. It also says the move places Pakistan among a relatively small group of jurisdictions that have created structured banking access for digital asset providers.
Analysts say the change could encourage crypto investors to move into formal banking channels. It may also support capital inflows by keeping more dollar inflows inside local banks, while giving customers and investors a clearer route to place savings and investments tied to digital currencies.
Even so, the policy remains tightly tied to licensing, verification, and compliance. That suggests Pakistan is not opening unrestricted access to crypto activity, but rather building a regulated channel for approved firms.
