ISLAMABAD: Pakistan has formally notified and legalised a comprehensive regulatory regime for virtual asset service providers, a move officials say will pull the country’s booming but unregulated cryptocurrency market under the rule of law and shield investors from fraud.
Bilal bin Saqib, chairman of the Pakistan Virtual Assets Regulatory Authority (PVARA), announced the new framework on Saturday, confirming that businesses offering digital asset services—whether domestic or international—now face a clear licensing process and legal obligations.
“For any businesses that want to provide virtual asset services in Pakistan, whether they are Pakistani or global, there is now a clear framework, a licensing process, and a legal front door,” Saqib said in a televised message.
Ten License Categories Under Virtual Assets Act 2026
The regulations, embedded in the Virtual Assets Act, 2026, establish ten distinct license categories covering exchange, custody, broker-dealer, advisory, lending and borrowing, derivatives, asset management, transfer and settlement, issuance, and mining-related services.
Each category carries detailed conduct, prudential, technology, anti-money laundering (AML) and countering the financing of terrorism (CFT) requirements, aligning Pakistan’s oversight with global standards.
The move marks a significant escalation in Pakistan’s efforts to formalise oversight of cryptocurrencies and other digital assets, transforming a largely unregulated market into one subject to transparency, compliance and investor protection rules.
Deadline for Existing Operators: September 5
In a separate press release, PVARA said existing virtual asset operators must apply for a no-objection certificate (NOC) with the authority by September 5. Under Section 70 of the Act, any person who was providing virtual asset services before the Act commenced must submit an NOC application by that date, or cease operations.
“Operating without submitting an application after that date is an offense,” the authority warned.
Saqib stressed that the crypto market had been operating outside the law in Pakistan, with millions of people involved in trading digital assets. “There were absolutely no regulations; they were non-existent,” he said. “And when such a large economic activity operates outside the law, the risk exists on both sides.”
New Legal Duties for Licensed Providers
PVARA outlined that licensed virtual asset service providers must keep customer holdings separate from their own and cannot lend or pledge them without written consent. These will now be legal obligations, not voluntary promises, the authority said.
Licensed providers will also gain access to the formal banking system, a step expected to integrate digital asset businesses into Pakistan’s mainstream financial infrastructure.
The framework is part of a broader push to curb fraud, enhance compliance, and ensure that one of the country’s fastest-growing economic sectors operates within a transparent legal structure.
