The SBP crypto banking ban, which shut Pakistani banks out of the crypto world for eight years, is now officially over. On April 14, 2026, the State Bank of Pakistan issued BPRD Circular Letter No. 10 of 2026, formally ending a blanket ban that had been in place since 2018. For millions of Pakistani crypto users and for exchanges trying to operate legally, this is a big deal. But the new rules come with important limits that everyone needs to understand.
Why the SBP Crypto Banking Ban Existed in the First Place
Back in April 2018, the State Bank of Pakistan told all banks and financial institutions to stay away from cryptocurrency. No accounts for crypto firms, no transactions, no services. The concern was money laundering, fraud, and the lack of any legal framework to oversee digital assets.
The result? Crypto did not go away. It just moved underground. Pakistan became one of the world’s largest retail crypto markets despite the ban. People used peer-to-peer apps, informal agents, and offshore platforms to buy and sell. The government could not see these flows, could not tax them, and could not protect users if something went wrong.
Eventually, the policy had to change. And it did, but in a structured way, not overnight.
What Changed on April 14, 2026
The SBP issued its new circular right after parliament passed the Virtual Assets Act 2026, which created the Pakistan Virtual Asset Regulatory Authority (PVARA) as a permanent regulator. PVARA’s job is to license, supervise, and oversee all crypto businesses operating in the country.
Under the new circular, Pakistani banks are now allowed to open bank accounts for companies that have been licensed by PVARA as Virtual Asset Service Providers, or VASPs. This includes crypto exchanges, wallet providers, custody platforms, and related fintech firms. Even firms that have applied for a PVARA licence and are still waiting for approval can access limited banking services, as long as they meet compliance rules.
This means a licensed crypto exchange in Pakistan can now have a real bank account, accept rupee transfers from customers, and process withdrawals, all through the formal banking system. No more juggling cash, informal channels, or offshore workarounds.
What Banks Can and Cannot Do Under the New Rules
The new framework is strict. It is controlled access, not a free-for-all. Here is what the rules actually say:
- Banks CAN open accounts for PVARA-licensed VASPs, including those still in the application process.
- Accounts must be rupee-only. No foreign currency accounts. No interest. No cash deposits or cash withdrawals.
- Client funds must be kept separate from the company’s own funds, in dedicated Client Money Accounts.
- Banks CANNOT trade, hold, or invest in crypto using their own capital or customer deposits. A bank’s role is to provide access, not to speculate.
- Enhanced due diligence is required. Banks must verify each firm’s PVARA licence, monitor all transactions on an ongoing basis, and report suspicious activity to Pakistan’s Financial Monitoring Unit under AML law.
- Foreign exchange rules still apply. The SBP made clear that having an arrangement with a VASP does not free banks from their existing foreign exchange obligations.
In short, the banks are acting as a bridge, not as crypto players themselves. They hold the rupee side of the business, while the crypto side stays within the PVARA-regulated ecosystem.
Where PVARA Licences Stand Right Now
PVARA started as a temporary body created by presidential ordinance in July 2025. The Virtual Assets Act 2026 turned it into a permanent, full-powered authority. It can now issue, suspend, and revoke licences. Operating without a PVARA licence carries criminal penalties: fines of up to PKR 50 million and prison sentences of up to five years. Unlicensed promotion of virtual assets can bring a separate fine of up to PKR 25 million and three years in jail.
Right now, PVARA is still in the NOC (No Objection Certificate) phase. Exchanges must first get an NOC before they can apply for a full licence. Firms with only an NOC can open limited bank accounts but cannot process transactions until they get full approval. Binance and HTX both received NOCs from PVARA in December 2025 and are still working through the full licensing process. Neither is currently permitted to fully operate in Pakistan.
The authority has also launched a Regulatory Sandbox for innovative startups that want to test products in a supervised environment before applying for a full licence. This is a useful on-ramp for local fintech companies.
For a sense of how Pakistan’s broader digital payments shift is playing out, see our coverage of Pakistan’s government payments digitalisation push, which is happening in parallel with crypto regulation.
What This Means for Pakistani Crypto Users
Pakistan already had roughly 27 to 40 million crypto users before the SBP crypto banking ban was lifted, making it one of the largest retail crypto markets in the world. People were using crypto to save money, send remittances, and protect their savings against rupee depreciation, all without any legal safety net.
Now, with licensed exchanges getting access to formal banking, a few things should improve for everyday users. Depositing and withdrawing rupees should become easier and cheaper. Licensed platforms will have to follow consumer protection standards set by PVARA. Disputes will have a formal process. And the risk of your exchange disappearing overnight will be lower, because regulated firms face real penalties and ongoing supervision.
That said, most big exchanges are still in the NOC phase. Full banking access will take time to roll out. Users should check whether an exchange holds a valid PVARA credential before depositing funds. The PVARA official website lists certified operators.
Pakistan also has bigger crypto ambitions in the pipeline: plans to tokenize up to USD 2 billion in government bonds and commodity reserves, a national stablecoin, expanded Bitcoin mining using surplus electricity, and possibly a strategic Bitcoin reserve. The lifting of the SBP crypto banking ban is the foundational step that makes all of this possible.
Frequently Asked Questions
What is the SBP crypto banking ban and when was it lifted?
The SBP crypto banking ban was a 2018 directive that stopped all Pakistani banks from dealing with crypto firms. The State Bank formally ended it on April 14, 2026, through BPRD Circular Letter No. 10 of 2026, after parliament passed the Virtual Assets Act 2026.
Can Pakistani banks now buy or hold Bitcoin?
No. Banks cannot trade, hold, or invest in any crypto asset using their own funds or customer deposits. Their role is limited to providing bank accounts and payment services to PVARA-licensed crypto companies. The line between the bank and the crypto market is kept very clear.
What is PVARA and do I need a licence to run a crypto exchange in Pakistan?
PVARA is the Pakistan Virtual Asset Regulatory Authority, the country’s permanent crypto regulator created by the Virtual Assets Act 2026. Yes, any exchange, wallet service, custodian, or token issuer must get a PVARA licence to operate legally. Running without one can result in fines up to PKR 50 million and up to five years in prison.
Are Binance and other global exchanges allowed to operate in Pakistan now?
Not yet fully. Binance and HTX both received No Objection Certificates from PVARA in December 2025, which is the first step. They must still complete full licensing, register with Pakistan’s Financial Monitoring Unit, and set up local entities before they can offer full services. The process is moving forward but is not complete.
