Legal Crypto In Pakistan

Cryptocurrency in Pakistan: Legality, Trends and All You Need to Know

Cryptocurrency in Pakistan is on the rise and unfortunately that is happening for good and bad reasons. With a tech-savvy youth and growing internet penetration, Pakistan is among the top countries when it comes to crypto adoption, even though the legality of the usage of crypto is a big question. This article looks at the legality of cryptocurrencies, the cannabinoid exchanges and local platforms, regulations on the space, as well as how the DeFi and NFT markets have been fairing. It also discusses two other areas, along the way: the part played by remittances in the adoption of crypto and the potential brewing in blockchain for financial inclusion.

Is cryptocurrency legal in Pakistan?

Cryptocurrency is not accepted as a legal tender in Pakistan and the legal status of cryptocurrency is debated. In 2018, notice was given by the State Bank of Pakistan (SBP) to financial institutions that they were to cease making transactions in virtual currencies, due to concerns of money laundering and terrorism financing. An SBP directive in 2024 reassured the stance and pronounced that Bitcoin and other digital currencies were illegal. The statement was issued on May, 30, 2025, and firm from the SBP has itself stated that virtual assets are not illegal and this points to a potential change of course. Creation of Pakistan Digital Assets Authority (PDAA) in 2025 (Rise of Government Regulation rather than outright Crypto Ban) PDAA’s creation was a part of government effort in the direction of regulation, as of June 2025, there isn’t comprehensive legal framework on crypto assets available. This lack of clarity can potentially deter firms and investors where enforcement is focused largely on fraud and other illegal conduct.

Popular Sites and Formats for Trading There are two types of exchanges you can use: Bitcoin exchanges and Marketplaces.

The high crypto adoption in Pakistan is attributed to numbers of people trading Bitcoin, Ethereum, as well as stablecoins such as Tether (USDT) on various exchanges. Liquidity and easy to use are what make the international exchanges very popular, these include Binance, Coinbase, and Kraken. Peer-to-peer (P2P) platforms such as LocalBitcoins and Paxful are popular too, as they allow trades to be arranged directly using local payment methods, such as bank transfers, or in person using cash or mobile apps. P2P is commonly used due to tight banking regulations, thereby enabling users to trade without reliance on the legacy financial system and swapping in Pakistani Rupees (PKR). These exchanges service Pakistan’s black-market crypto scene, which thrives in spite of – or perhaps because of – strict regulations.

Local Exchanges

The following are some cryptocurrency exchanges based in the country currently in operation and startups looking to establish cryptocurrency exchanges in Pakistan. Market places such as BitEx and Urdubit (historically operational) seek to cater local users with PKR supported trading pairs and native customer service. These bourses also face issues like poor liquidity and competition from foreign platforms. V/C service provider has also been adapting for when PDAA brings its own regulations to bear and yet local providers of payment services may be less dominant than in some other countries because of both the scale and reliability of international exchanges.

Additional Information

List of Key Regulatory Bodies

• State Bank of Pakistan (SBP)
• Securities and Exchange Commission of Pakistan (SECP)
• Pakistan Digital Assets Authority (PDAA)
• Federal Investigation Agency (FIA) – Cybercrime Wing
• Ministry of Information Technology and Telecom

Table of Cryptocurrency Adoption Metrics (Estimated)

Metric	Value
Estimated Crypto Users	~20 million
Annual Crypto Trading Volume	~$25 billion (informal)
Top Cryptocurrencies Traded	Bitcoin, Ethereum, USDT
Percentage of Unbanked Population	~50%
Internet Penetration Rate	~55%

Note: Metrics are estimates based on informal market data due to limited regulation.

Legal Aspects That Govern The Cryptocurrency market

Cryptocurrency regulations in Pakistan are not considered that advanced. The SBP back in 2018’s notice as well as the 2024 directive that came later outlawing cryptocurrencies in paragraph 3 remains dominant, and it bars fintechs from engaging with crypto setups. The SECP has reminded the public on unregistered crypto scams. The PDAA, which was founded in 2025, has a goal to come to an agreement form of licensing for crypto companies, to combat financial crimes and design oversight on taxes, anti-money laundering (AML) and know-your-customer (KYC) regulations. But such rules have not been enforced yet, and the market remains in a gray area, where enforcement centers on fraud and illicit financial activities.

DeFi Market in Pakistan

There is a small surge of interest in decentralized finance (DeFi) within parts of the tech community in Pakistan. DeFi protocols running on blockchains, including Ethereum and Binance Smart Chain, offer lending, borrowing, and yield farming with no intermediaries. Surface Adoption is restricted by the technical complexity, high transaction costs and legal uncertainly. Pakistani users are interacting with global protocols such as Uniswap, Aave and Compound, and are, in many cases, stabilizing volatility by using stablecoins. We may see the PDAA regulating DeFi one day and it could mean KYC and AML compliance, however, for now, DeFi is a niche sector with space to grow.

NFT Market in Pakistan

Pakistan Below are some Pakistani designers who have dabbled with NFTs Enter NFTs The NFT market in Pakistan is small, but growing. Pakistani artists, musicians and creators are experimenting with NFTs to monetize digital content through platforms such as OpenSea and Rarible. High Ethereum gas fees and lack of widespread awareness hamper adoption, but local efforts, including NFT marketplaces catering to Pakistani creators, are surfacing. As evidenced by Pakistan’s rich artistic and musical culture, it is a candidate for an NFT hub should infrastructure and public education improve.

Crypto and Remittances

Pakistan’s economy depends on remittances, which are sent back by its overseas labour force to the tune of billions of dollars a year. Cryptocurrencies, stablecoins in particular, provide a quicker and cheaper option of transferring funds than the traditional remittance methods. Exchanges such as Binance and Paxful make it possible for Pakistanis living abroad to send cryptocurrency that recipients then convert to PKR on P2P markets. This adoption is fuelled by the traction in rural areas, where banking infrastructure is scarce at best. But the regulatory clampdown on cross-border crypto flows is a risk, and the PDAA could impose supervision rules.

Blockchain for Inclusion of the Unbanked

Pakistan’s unbanked population, currently at around 50% are a prime target for blockchain based financial inclusion initiatives. Decentralized platforms can offer savings, credit and even insurance without having traditional bank accounts. Blockchain powered KYC and microfinance projects are also being pursued on a large scale with support from the Pakistani tech startup ecosystem. Government digital transformation projects and the PDAA’s regulatory work could speed up the pace of blockchain, and hence set the scene to empower underbanked populations.

Conclusion

The cryptocurrency space in Pakistan has a thriving community of users and activity amidst no clear regulation. Currently, these are not legal tender, and SBP circulars (2018 and 2024) have declared them illegal, though latest developments-- establishment of the PDAA, and a statement by the SBP in May 2025-- indicate a movement towards legalisation. Trading is dominated by international and P2P exchange, and there are emerging opportunities in DeFi and NFTs. The part crypto can play in remittances and blockchain’s capacity for financial inclusion, highlight the unique position Pakistan holds in the global crypto sphere. While PDAA formulates the rules, Pakistan can use digital assets for innovation and economic progress, so long as the risks are managed with a sound legal framework.