ISLAMABAD, April 15 —
- New Law: Pakistan enacted the Virtual Assets Act 2026, establishing the country’s first legal framework for crypto businesses.
- Regulator Created: The Pakistan Virtual Asset Regulatory Authority (PVARA) will oversee licensing and regulation of digital asset companies.
- Banking Access: Banks can now open accounts for licensed Virtual Asset Service Providers (VASPs).
- Compliance Rules: Banks must follow strict anti-money laundering (AML) checks and enhanced due diligence.
- Operational Limits: Banks are prohibited from trading, holding, or investing in crypto assets using their own funds.
- Account Rules: VASP client accounts must be rupee-denominated, non-interest bearing, with no cash deposits or withdrawals allowed.
| Regulation Element | Details | Purpose |
|---|---|---|
| Virtual Assets Act | 2026 law | Establishes legal framework for crypto |
| Regulator | PVARA | Licensing and supervision of VASPs |
| Bank accounts | Allowed for licensed VASPs | Connect crypto firms to banking system |
| Client accounts | Rupee-based, non-interest | Protect customer funds |
| Bank restrictions | No crypto trading by banks | Prevent financial speculation risk |
Pakistan Introduces Legal Framework for Digital Assets
Pakistan has taken a major step toward regulating the digital asset industry with the implementation of the Virtual Assets Act 2026.
The new legislation formally allows crypto-related businesses to operate within the country under regulatory oversight.
Authorities say the framework aims to balance innovation in digital finance with strong safeguards against financial crime.
Creation of a National Crypto Regulator
The law establishes the Pakistan Virtual Asset Regulatory Authority (PVARA), which will be responsible for licensing and supervising companies operating in the digital asset ecosystem.
The regulator will oversee exchanges, digital wallet providers, blockchain platforms and other crypto-related financial technology services.
Banking Access for Crypto Firms
Under the new policy, banks and financial institutions regulated by the State Bank of Pakistan may open accounts for companies licensed by PVARA as Virtual Asset Service Providers.
However, banks must verify licenses before onboarding such companies and must maintain separate client funds accounts for customer transactions.
Strict Compliance Measures
To prevent misuse of the financial system, authorities have imposed strict compliance measures.
Banks must monitor transactions closely, conduct enhanced due diligence on clients and report suspicious activities under existing anti-money laundering regulations.
At the same time, banks themselves are not permitted to trade or hold virtual assets.
Shift From Previous Restrictions
Pakistan previously maintained tight restrictions on crypto-related businesses, with limited access to the formal banking system.
The new framework signals a shift toward regulated adoption of blockchain and digital finance technologies while maintaining oversight to mitigate financial risks.
