In a historic reversal of its eight-year-old restrictive policy, the State Bank of Pakistan (SBP) has formally authorized commercial banks to provide financial services to licensed cryptocurrency and virtual asset firms. The central bank issued BPRD Circular Letter No. 10 of 2026 on Wednesday, effectively overriding the 2018 ban that had previously blocked the digital asset sector from the formal banking system. This major policy shift follows the recent enactment of the Virtual Assets Act, 2026, which established a legal framework for digital currencies and blockchain technology in Pakistan.
Under the new guidelines, banks are permitted to open and maintain accounts for Virtual Asset Service Providers (VASPs) that hold a valid license or No Objection Certificate (NOC) from the newly formed Pakistan Virtual Assets Regulatory Authority (PVARA). Bilal bin Saqib, Chairman of PVARA, described the move as a foundational shift that transitions Pakistan from a restrictive environment to a structured, regulated ecosystem. The new rules require banks to maintain segregated, non-interest-bearing “Client Money Accounts” to ensure that user funds are kept entirely separate from the company’s operational capital, providing an extra layer of protection for investors.
While the doors are now open for crypto-related businesses, the SBP has maintained a cautious stance on direct institutional exposure. Banks are strictly prohibited from investing in, trading, or holding virtual assets using their own capital or their customers’ funds. Furthermore, financial institutions remain responsible for rigorous due diligence, risk profiling, and reporting suspicious transactions in alignment with international anti-money laundering (AML) and counter-terrorism financing (CFT) standards. This move is expected to legitimize the billions in trade volume already existing in the country and attract global players like Binance and HTX, which have already begun the licensing process with PVARA.
