Pakistan has reported a $600 million loss to illegal crypto activity as residents move dollars through unregulated channels.
Pakistan has reported a rise in unlawful crypto activity that has drained more than $600 million from the country.
The issue has created fresh pressure on the banking system as more residents move dollars through unregulated channels to buy digital assets.
Authorities are now worried that the growing demand for crypto could weaken efforts to protect the dollar supply, which remains important for the country’s stability.
Growing concern as dollars leave the formal system
Pakistan’s exchange companies and financial officials have sounded alarms over the mass movement of dollars into crypto markets through restricted routes.
According to Malik Bostan, chairman of the Exchange Companies Association of Pakistan, the drop in dollar sales to banks shows how people are moving their money.
🔍 Pakistan just lost $600 million to illegal crypto trades — dollars are being routed from FCY accounts straight into unregulated crypto platforms. 🇵🇰💸 What’s the real cost to our economy? pic.twitter.com/0ntLZN32Xb
— KK (@technocrat_kk) November 22, 2025
He explained that buyers now take dollars from exchange companies, place the funds in foreign currency accounts, then withdraw the money to purchase digital assets.
This pattern has reduced the flow of dollars into local banks and created a clear gap between deposits and withdrawals.
Bostan said banks received around $4 billion during the first ten months of the previous year. During the same period this year, the amount dropped to $3 billion. He believes much of the missing amount moved into crypto markets without passing through legal pathways.
New rules attempt to stop the leak of dollars
Pakistan’s central bank issued a circular that blocked banks and exchange companies from handing out cash dollars.
They must now transfer the money straight into foreign currency accounts and the rule aims to improve record keeping and reduce opportunities for illegal transfers.
Despite the measure, residents appear to be taking another route. Exchange companies now issue cheques or send funds directly into customers’ accounts.
The same customers then pull the money out and use it to buy crypto on channels that operate outside official oversight. This pattern has allowed millions of dollars to leave the country with no trace.
Data from the State Bank of Pakistan shows that commercial banks’ dollar holdings grew from $4.180 billion in January to $4.625 billion. This increase indicates that banks hold more dollars, yet the flow of dollars from exchange companies into the banking system remains weak.
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Dollar sales show a clear decline
Recent figures show a steady fall in monthly dollar sales by exchange companies. July saw $280 million sold to banks, compared to $333 million during the same month last year.
August recorded $163 million, down from $295 million while September reached $186 million, down from $214 million. October climbed slightly to $244 million, but last year’s figure was much higher at $297 million.
Overall sales during July to October last year stood at $1.139 billion. This year, during the same period, the figure dropped to $873 million.
That marks a decrease of about 23 percent.
Officials are warning that this drop shows a rising trend where people bypass formal channels and use other routes to buy crypto. The trend is becoming a direct challenge to the government’s efforts to keep dollars inside the system.
In all, authorities hope that better oversight will help reduce the $600 million loss that has shaken public trust. The goal is not to block crypto activity but to keep it inside a lawful structure that supports the country’s financial stability.
