Pakistan has officially passed the Virtual Asset (Regulation) Act (PVARA), marking a crucial step in the country's path towards cryptocurrency compliance. The act was initially promulgated as a presidential ordinance in July 2025 and was set to expire in March 2026. Consequently, the parliament swiftly moved to transform it into permanent law. The formulation of the act was based on the Pakistan Crypto Committee, established in March 2025 and led by CEO Bilal bin Saqib, which spent months constructing the policy framework.
The PVARA's regulatory committee comprises senior officials from the Ministry of Finance, the Ministry of Justice, the State Bank of Pakistan, the Securities and Exchange Commission, the National Counter Terrorism Authority, and two independent experts with cryptocurrency market backgrounds, ensuring the professionalism and multi-dimensional coordination of the regulation.
According to the new regulations, all virtual asset service providers operating in Pakistan or providing services to Pakistani users—including exchanges, custodians, and token issuers—must obtain a formal license issued by the PVARA. Applicant institutions must already be recognized in major jurisdictions such as the United States, Europe, or Singapore, and meet minimum capital requirements. Currently, mainstream platforms such as Binance and HTX have obtained "No Objection Certificates" and are cooperating with the State Bank to build compliant payment channels.
Notably, the PVARA incorporates Islamic finance principles into the cryptocurrency regulatory system for the first time, establishing a dedicated Islamic Finance Advisory Committee to ensure that all crypto services comply with Sharia law. This innovative measure is expected to attract Islamic banks and institutional funds that previously avoided digital assets due to religious compliance concerns, promoting the integration of traditional financial systems and the crypto ecosystem.
In terms of anti-money laundering, the act explicitly requires licensed service providers to strictly implement anti-money laundering and counter-terrorism financing (AML-CFT) obligations, fully aligning with the Financial Action Task Force (FATF) standards, helping Pakistan escape its previous unfavorable position on the FATF gray list.
Furthermore, Pakistan's crypto strategic layout extends beyond license management. The government has announced that it will establish a strategic Bitcoin reserve and reserve 2000 megawatts of dedicated power resources for crypto mining and AI data centers. In January 2026, Pakistan also signed a memorandum with SC Financial Technologies to pilot a USD1 stablecoin in cross-border payments and remittances to reduce fund transfer costs and improve efficiency. Considering the significant proportion of overseas labor remittances in the country's GDP, this move is expected to reshape the national financial infrastructure.
With the implementation of the regulatory framework, Pakistan is gradually transforming from a spectator in the crypto market into an emerging regulatory hub with unique religious compliance advantages.