On April 14, 2026, the State Bank of Pakistan issued BPRD Circular Letter No. 10 of 2026 — and with it, lifted the ban that had separated Pakistan's financial system from cryptocurrency since 2018. The Royal Binary Team has reviewed the circular in depth and presents its practical implications for Pakistani investors.
Seven Years of the Ban: A Brief Background
In 2018, SBP prohibited all banks and financial institutions from engaging in any cryptocurrency-related transactions. The decision was made in light of global uncertainty at the time and domestic regulatory concerns. The result: Pakistani investors either relied on informal channels or stayed entirely outside this emerging asset class. During that period, Bitcoin globally peaked at $69,000 in 2021, ETFs were approved, and institutional investment began — while Pakistan's banking system remained disconnected from all of it.
Circular No. 10: What Changed?
The Royal Binary Team's analysts summarize the circular's four key points:
Point One: Banks Can Now Provide VASP Services Banks may work with Virtual Asset Service Providers (VASPs) that have either received a full license or a No Objection Certificate (NoC) from the Pakistan Virtual Assets Regulatory Authority (PVARA). This means that in the future, licensed crypto exchanges will be able to offer their customers fund transfers via Pakistani bank accounts.
Point Two: Banks Still Barred From Proprietary Trading Banks cannot trade or hold crypto with their own funds or customer deposits. This is a critical boundary — the circular permits VASP servicing, it does not turn banks into crypto investors.
Point Three: AML/KYC Compliance Is Mandatory All transactions must comply with Anti-Money Laundering and Know Your Customer regulations. Banks will only service VASPs that can demonstrate full compliance.
Point Four: The PVARA Framework This circular did not arrive in a vacuum — it is part of the 2026 Virtual Asset Act under which PVARA was established. PVARA is the body that will issue licenses and NoCs to VASPs and oversee them.
PVARA: The New Regulatory Architecture
Our analysts observe that PVARA's establishment is not merely paperwork. Under the 2026 Virtual Asset Act, the authority will:
- Issue VASP licenses and NoCs
- Supervise crypto exchanges and wallet providers
- Enforce AML/KYC standards
- Develop consumer protection regulations
This architecture resembles the UAE's VARA or Europe's MiCA framework — a signal that Pakistan is aligning with global regulatory trends. However, PVARA is new and practical licensing has yet to begin.
Practical Meaning for Pakistani Investors
The Royal Binary Team makes clear that this circular does not deliver immediate change — rather, it lays a necessary foundation:
A legal pathway opens: for the first time, Pakistani investors will be able to invest in crypto through licensed channels. Reliance on informal routes will decrease, and regulatory risk will shrink.
Bank integration: once PVARA-licensed exchanges emerge, PKR deposits and withdrawals will be possible via bank accounts — similar to what already happens in India or Turkey.
Investor protection: licensed VASPs will be bound by AML/KYC regulations, which should relatively reduce the risk of fraud and scams.
Tax and documentation: legal investing also means record-keeping — tax policy should become clearer in the coming months.
Current Economic Context
Royal Binary analysts view this move within Pakistan's broader economic situation. The country's Real Effective Exchange Rate (REER) has reached a seven-and-a-half-year high, reflecting relative rupee stability. The KSE-100 index has shown a positive trend in recent months. In this environment, opening a legal crypto corridor offers domestic investors an additional alternative.
Pakistani households have a strong tradition of prize bonds and conventional savings schemes — visible in Trends data showing two-hundred-thousand-plus winners in a 750-rupee prize bond draw. The shift toward digital assets may be an extension of that savings culture rather than a replacement.
What Remains Unclear
Our analysts identify several important open questions:
- When will PVARA issue its first license, and which exchanges will qualify?
- What will the tax treatment of crypto gains be?
- Can foreign licensed exchanges apply for NoCs?
- What powers will PVARA have to protect customer deposits?
These questions will become clearer over the coming months. Investors should monitor relevant developments while waiting for these answers.
Risks Not to Be Overlooked
The Royal Binary Team always presents a balanced perspective. This change comes with real risks:
Crypto's inherent volatility: Bitcoin and other crypto assets are extremely volatile. Past price appreciation is not a guarantee of future results. Crypto values can drop 50–70% within a few weeks.
Regulatory uncertainty: regulations can change. PVARA is new and its rules are still being formed. New restrictions or conditions may be imposed in the future.
VASP risk: being licensed does not protect any exchange from failure — several major licensed institutions globally have closed.
Liquidity: few PVARA-licensed platforms exist at this point; early-stage liquidity may be limited.
The Bigger Picture: Where Pakistan Is Heading
The Royal Binary Team analyzes this circular not as an isolated event but as part of a broader trend. The Gulf states, Singapore, the European Union, and most recently the United States have all brought crypto into formal regulatory frameworks — preferring oversight to prohibition. Pakistan's step is in that same global direction.
The 2026 Virtual Asset Act and the establishment of PVARA indicate that the state wants to integrate crypto into the financial system rather than eliminate it — with control. This is a more sustainable long-term policy.
What Happens Next?
For the Royal Binary Team's analysts, the next six to twelve months will be decisive:
- PVARA issuing its first license and licensed exchanges becoming operational
- Banks beginning VASP onboarding and the PKR-to-crypto corridor opening
- Tax authorities issuing guidance on crypto income
- Customer responses and first transaction volumes becoming visible
We will monitor these developments and keep our readers updated.
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