Pakistan’s New Crypto Regulator PVARA: What It Means for Virtual Assets

2025-08-19

In July 2025, Pakistan took a major step in digital finance by introducing the Pakistan Virtual Assets Regulatory Authority (PVARA). Established under the Virtual Assets Ordinance, 2025, PVARA is now the primary federal body responsible for regulating, licensing, and supervising the country’s growing virtual asset ecosystem.

The move reflects Pakistan’s attempt to balance innovation with compliance, aligning its crypto law with global standards such as those of the Financial Action Task Force (FATF).

With the rise of virtual assets worldwide, the new regulator aims to create a secure and transparent framework for investors, businesses, and innovators.

Background of PVARA

PVARA was created when President Asif Ali Zardari signed the Virtual Assets Ordinance, 2025, into law on July 8, 2025.

The ordinance was introduced under Article 89 of the Constitution as an urgent measure while Parliament was not in session.

Although initially referred to as the "Virtual Assets Act, 2025," it was later clarified that the measure was an ordinance, effective for 120 days unless extended or passed as legislation.

This marked the first time Pakistan had a dedicated authority specifically for virtual assets regulation.

Purpose and Functions of PVARA

The establishment of PVARA under the new Pakistan crypto law comes with a clear set of objectives:

Licensing Authority: Any individual or entity offering virtual asset services in or from Pakistan must obtain a license.
Regulatory Oversight: Supervising compliance with financial, legal, and security standards.
Innovation Sandbox: A controlled environment for testing new digital asset technologies.
Sharia Compliance: A dedicated advisory committee ensures that products align with Islamic finance principles.
Dispute Resolution: A Virtual Assets Appellate Tribunal handles appeals independently.

These measures highlight the government’s intent to foster innovation while minimizing risks of misuse, money laundering, or terrorist financing.

Structure of the Authority

PVARA’s governance includes representatives from key financial and regulatory institutions:

Governor of the State Bank of Pakistan
Secretaries of Finance, Law and Justice, and IT & Telecom
Chairpersons of SECP, FBR, and Digital Pakistan Authority
Two independent directors with expertise in finance or technology
A chairperson appointed for their regulatory and technical experience

This structure ensures cross-sector coordination and credible oversight for Pakistan’s virtual asset ecosystem.

Key Implications for Virtual Assets in Pakistan

The introduction of PVARA signals a turning point for digital finance in the country. Its impact includes:

Legal Clarity: A defined Pakistan crypto law helps reduce uncertainty for startups and investors.
International Alignment: Compliance with FATF guidelines improves Pakistan’s standing in global finance.
Investor Confidence: Clear licensing requirements build trust among both domestic and foreign stakeholders.
Innovation Support: Regulatory sandboxes provide room for experimentation without compromising security.

Related Initiatives

PVARA’s creation follows the launch of the Pakistan Crypto Council (PCC) earlier in March 2025. The PCC, chaired by Finance Minister Muhammad Aurangzeb, aims to accelerate adoption of digital finance and strengthen cooperation between regulators, industry players, and innovators.

Together, these developments demonstrate Pakistan’s increasing focus on integrating virtual assets into its broader financial system.

Conclusion

With the launch of PVARA, Pakistan is entering a new era of digital finance regulation. By creating a structured framework for virtual assets, the government aims to encourage innovation while safeguarding financial integrity.

For entrepreneurs and investors, this means clearer rules of engagement and more opportunities to participate in a regulated digital economy.

While challenges remain, the establishment of PVARA is a decisive step toward making Pakistan a recognized player in the global crypto landscape.

For more in-depth crypto market updates and predictions, check out the latest posts on the Bitrue blog, or explore trading directly on Bitrue’s platform.

FAQ

What is PVARA?

PVARA is the Pakistan Virtual Assets Regulatory Authority, created in 2025 to regulate virtual assets and service providers.

Is the Virtual Assets Ordinance a permanent law?

Currently, it is an ordinance effective for 120 days, subject to extension or approval by Parliament.

Why was PVARA established?

To license, regulate, and supervise virtual asset services, ensuring compliance with financial and security standards.

Does PVARA cover Sharia compliance?

Yes, a dedicated Sharia Advisory Committee ensures that virtual asset products follow Islamic finance principles.

How does PVARA support innovation?

Through a regulatory sandbox and no-action letters that allow controlled testing of new technologies.

Pakistan

Disclaimer: The content of this article does not constitute financial or investment advice.

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