Pakistan's central bank has lifted a seven-year ban on banking services for crypto businesses, allowing licensed virtual asset service providers to open accounts with commercial banks for the first time.

The decision follows the passage of the Virtual Assets Act, 2026, and represents the country's most concrete move yet to bring cryptocurrency-related companies into its regulated financial system. Banks are now required to verify that any crypto firm holds a valid licence from the newly created Pakistan Virtual Assets Regulatory Authority (PVARA) before onboarding them as clients.

Under the new rules, client funds must be held in segregated, non-interest-bearing rupee accounts. Banks retain full responsibility for due diligence, risk profiling, and reporting suspicious activity. Crucially, financial institutions are prohibited from using either their own capital or customer deposits to invest in or hold digital assets.

The development fits into a broader push by Pakistan to position itself as a destination for global crypto players. The country signed a memorandum of understanding with Binance in December to explore tokenising up to $2 billion in assets, granted preliminary clearances to both Binance and HTX to begin the licensing process, and reached a deal with a World Liberty Financial affiliate in January to pilot stablecoin-based cross-border payments.