Cryptocurrency in Pakistan: Legal Status, Risks, and How People Trade Anyway

When you hear cryptocurrency in Pakistan, a digital asset system that operates outside state-controlled banking. Also known as crypto trading Pakistan, it’s a financial lifeline for millions who can’t access traditional banking—but it’s also illegal under local regulations. The State Bank of Pakistan banned banks from handling crypto transactions in 2021, but that didn’t stop people. Instead, it pushed trading underground, where peer-to-peer (P2P) platforms and cash deals became the norm.

People in Pakistan now use P2P crypto Pakistan, a decentralized way to buy and sell Bitcoin and USDT directly with cash or bank transfers to bypass the ban. Apps like LocalBitcoins and Paxful are packed with sellers offering rates that beat official exchange rates. Traders meet in cafes, use WhatsApp to coordinate, and even trade through hawala networks. This isn’t just about speculation—it’s about survival. With inflation hitting 35% and the rupee losing value fast, crypto offers a way to protect savings. But there’s a cost: no legal protection, no recourse if you get scammed, and the real risk of arrest. Police have raided homes and seized phones for crypto-related activity, especially when large cash transfers are involved.

Even though banks won’t touch crypto, some Pakistanis still find ways in. They use foreign bank accounts, prepaid cards, or shell companies to move money. Others trade through offshore exchanges that don’t require KYC. The government keeps threatening crackdowns, but enforcement is patchy. What’s clear is that demand won’t disappear. People need tools to store value, send money home, and access global markets—and crypto delivers that. Below, you’ll find real stories and guides on how crypto works in Pakistan: the platforms people use, the scams to avoid, the legal gray zones, and what happens when authorities show up.