Someone in your family has probably asked this. A brother, a cousin, maybe a friend at work. They heard bitcoin makes money. Then they read an old article saying it is banned in Pakistan. Which answer is right?
The truth changed in 2026. Bitcoin is no longer banned. Pakistan passed a new law that regulates it instead. Here is what that law says, in plain English.
Is Bitcoin legal in Pakistan?
Yes. Buying, holding and selling bitcoin is legal in Pakistan as of 2026. The change came with the Virtual Assets Act, 2026, which Parliament passed in March 2026 and the President signed on 4 March. It was published in the official Gazette on 5 March.
But there are limits. Bitcoin is not legal tender. No shop or bank has to accept it as payment. And the business of bitcoin, like running an exchange or a wallet service, now needs a licence from a new regulator called PVARA. Doing that without a licence is a criminal offence. We explain the wider law in our post on whether cryptocurrency is legal in Pakistan.
Where the old ban came from
For years the answer really was banned. On 6 April 2018 the State Bank of Pakistan issued a circular that stopped banks from dealing in virtual currencies. That circular, BPRD Circular No. 03 of 2018, is the source of almost every "crypto is illegal" article you have read.
The State Bank replaced it on 14 April 2026 with BPRD Circular Letter No. 10 of 2026. Banks can now open accounts for licensed crypto exchanges, with strict conditions. The blanket ban is gone.
What you can legally do with bitcoin
- Buy and hold bitcoin. Owning it is legal. You do not need anyone's permission.
- Keep it in your own wallet. A wallet where you hold the keys is not a licensed service.
- Sell or trade it. Legal, but use a platform that is inside PVARA's licensing process.
- Mine for yourself. Mining your own coins is not a licensed activity. Only mining services that handle other people's money need a licence.
People who mined Pi Network on their phones ask about this a lot. The legal status of Pi Network in Pakistan follows the same rules: holding is fine, running a service for others is not. If you are thinking about buying mining machines, our guide on whether crypto mining is legal in Pakistan walks through the law and the electricity risks.
What is still illegal or risky
Running a crypto business without a licence is the big one. Under the Virtual Assets Act, operating an exchange, wallet service or custody service without PVARA approval is a criminal offence. Reports put the penalty at fines up to 50 million rupees and up to five years in prison for an unlicensed virtual asset business, and up to 25 million rupees and three years for promoting an unapproved token. The regulator's own FAQ says the licensing rules apply to anyone offering virtual asset services in or from Pakistan.
Banks cannot trade bitcoin with their own money or with customer deposits. The new State Bank circular only lets banks serve licensed exchanges, and even those accounts have strict limits. No cash deposits and no cash withdrawals through them.
Scams are still scams. The law change did not make fake investment apps legal. Fraud is still a crime under the Prevention of Electronic Crimes Act 2016. An app that promises guaranteed returns is a scam, whatever the new law says.
Betting apps are a separate category. They promise easy money and take payments in bitcoin and USDT, but the apps themselves are banned in Pakistan. The law on them is explained in our post on online betting and casino apps in Pakistan.
What about P2P trading
Most everyday buying in Pakistan still happens through peer to peer trading, where a buyer and seller exchange rupees and bitcoin directly. The law does not write a blanket ban on a person owning coins or trading on an offshore exchange from a phone. The penalties are aimed at businesses that operate without a licence.
But P2P has no protection. You are dealing with a stranger. If a payment is linked to fraud, your bank account can be frozen. Keep records of every trade. If money lands in your account and you cannot explain where it came from, it can be treated as unexplained income.
No exchange holds a full PVARA licence yet. In December 2025 the regulator gave no objection certificates to Binance and HTX. An NOC is not a licence. It is the first step toward one. We covered the details in our post on whether Binance is legal in Pakistan. Exchanges already operating had until 5 September 2026 to apply or shut down under Section 70 of the Act. That deadline has passed.
Most P2P deals in Pakistan happen in USDT, the dollar pegged stablecoin. The rules are the same, and we explain them in our post on whether USDT is legal in Pakistan.
Does the government tax bitcoin?
There is no separate crypto tax law yet. That does not mean bitcoin is tax free. The Federal Board of Revenue treats crypto gains under the Income Tax Ordinance 2001. Frequent trading counts as business income. Selling coins you held for a while counts as capital gains.
The practical rule is to keep records of every buy and sell. If money lands in your bank account and you cannot explain where it came from, it can be treated as unexplained income. A dedicated crypto tax law is being discussed, but nothing is final.
Bitcoin is legal to own in Pakistan in 2026. Use platforms that are inside the licensing process, keep your own wallet, and treat any app that promises guaranteed returns as a scam. More plain English law guides are on the Lexiber blog, and the home page is lexiber.com.
Do you have a specific question about bitcoin or a frozen account? Ask Lexiber free in English or Urdu. It shows you the exact section behind every answer.
