Notification and legalisation of regulations governing virtual asset services

ISLAMABAD: Chairman Pakistan Virtual Assets Regulatory Authority (PVARA) Bilal bin Saqib said on Saturday that the new regulations on virtual asset services have been notified and legalised and this step will protect digital investors from fraud.

Under the system, Pakistan would license and regulate virtual asset service providers. The regulations, which are part of the Virtual Assets Act, 2026, list ten types of licences, including exchange, custody, broker-dealer, advisory, lending and borrowing, derivatives, asset management, transfer and settlement, issuance and mining related services.

Each category puts up detailed standards including conduct, prudential, technology and anti-money laundering (AML) and countering the funding of “terrorism” (CFT).

The action is part of Pakistan’s broader attempt to formalise the oversight of cryptocurrencies and other digital currencies, bringing a largely uncontrolled industry under a framework in line with global norms to promote transparency, compliance and investor protection.

“This means that now there is a clear framework, a licensing process and a legal front door for any business that wants to provide virtual asset services in Pakistan, whether they are Pakistani or global,” Saqib said in a televised statement.

The rules would help safeguard investors in digital currencies from fraud and put the entire crypto market under the rule of law, the official added.

In Pakistan, the crypto market has been operating without any law and millions of people were participating in trading of digital currencies,” he said.

“But there were no regulations, no regulations at all,” he claimed. “And when such a big economic activity is outside the law, the risk is on both sides.

In a separate news release by PVARA, the authority said existing virtual asset operators need to apply for a no-objection certificate with the authority by September 5.

“Any person who was providing virtual asset services before the commencement of the Act shall submit a NOC application by such date or shall cease to provide virtual asset services,” PVARA added. “After that date, operating without an application is an offense.”

Licensed virtual asset service providers must maintain customer holdings distinct from their own and cannot lend or pledge them without prior approval, said PVARA. “Promises will be binding commitments,” the authority added.

The authority said it will allow licensed providers to get into the formal banking system.