After a turbulent period in global crypto markets, Pakistan has embarked on a rapid and ambitious journey to formalize its multi-billion dollar virtual asset sector. What began with the announcement of a high-level Crypto Council has evolved into a full regulatory framework under the new Pakistan Virtual Assets Regulatory Authority (PVARA), aiming to attract international investment while managing significant domestic risks.
The Genesis: Pakistan Crypto Council and Leadership Flux
In early 2025, Pakistan raised cryptocurrency as a pivotal agenda item under its commercial diplomacy strategy, leading to the establishment of the National Crypto Council within the Finance Ministry. The appointment of Bilal Bin Saqib as CEO of this council signaled a vigorous push towards integrating digital currencies into the national economy. From his roles as Chief Advisor to the Finance Minister to his later position as Special Assistant to the Prime Minister on Blockchain and Crypto, Saqib’s rapidly changing titles highlighted the urgency with which the government viewed this initiative.
However, Saqib’s resignation from the SAPM role in August 2025 was clouded by controversy, as concerns emerged over potential conflicts of interest. Despite stepping down, he was appointed Chairman of the newly established PVARA, tasked with leading Pakistan towards a clearer regulatory framework for virtual assets. Interestingly, the status of the initial Crypto Council remains ambiguous, with finance ministry sources suggesting no recent meetings while the council maintains an online presence.
Establishing the Legal Framework: The Virtual Assets Ordinance
The cornerstone of this regulatory transformation can be traced back to Ordinance No. VII of 2025, promulgated on July 8, 2025, which established PVARA as an independent regulator. This ordinance empowered PVARA to license, regulate, and supervise Virtual Asset Service Providers (VASPs), aligning closely with international standards, particularly those set by the Financial Action Task Force (FATF). It also introduced innovative mechanisms like a regulatory sandbox that encourages safe testing of emerging technologies.
Additionally, a Sharia Advisory Committee was included in the ordinance, reflecting Pakistan’s commitment to ensuring that virtual asset products are compliant with Islamic finance principles. The multi-stakeholder board overseeing PVARA comprises prominent figures from various regulatory bodies, including the State Bank of Pakistan and the Securities and Exchange Commission of Pakistan, hinting at a collaborative approach to financial regulation.
PVARA’s Initial Moves and Market Potential
Since its first board meeting in late August 2025, PVARA has been making strategic moves to lay a solid foundation for the crypto market in Pakistan. One of its first initiatives was to launch a Crypto Grievance Cell in collaboration with the National Cyber Crime Investigation Agency, addressing growing concerns about fraud in the crypto space. Additionally, the authority has proactively published Anti-Money Laundering (AML) regulations, signaling a commitment to compliance ahead of licensing.
In September 2025, PVARA invited Expressions of Interest from globally licensed VASPs, showcasing Pakistan’s vast, untapped market of over 40 million users and an estimated $300 billion in annual trading volume. Finance Minister Muhammad Aurangzeb emphasized the need for a robust regulatory environment to bolster innovation while safeguarding economic interests, underscoring Pakistan’s aspiration to be a leader in the digital economy.
Policy Debates and Practical Pilots
As Pakistan forges ahead in its crypto journey, critical policy debates are emerging, particularly concerning the introduction of stablecoins. At the recent Binance Blockchain Week, Bilal Bin Saqib highlighted plans for a state-backed stablecoin in conjunction with the SBP’s Central Bank Digital Currency (CBDC) pilot. Experts like Aatiqa Lateef advocate for a sovereign approach, suggesting that issuance should remain under SBP control while allowing the private sector to handle distribution.
On the ground, practical tests are already in progress. Hassan Baig of the Stacks Asia Foundation announced plans to execute Pakistan’s first cross-border payment over crypto rails, aiming for quick, low-cost transfers.
“We’re on the cusp of this milestone,” Baig stated
underscoring the operational ethos of innovation and efficiency that PVARA aims to promote.
Challenges and the Road Ahead
Despite rapid advancements, challenges loom large as high-level discussions held in December 2025 contemplated a “time-bound amnesty” for traders amid local banks’ compliance worries. This discussion was prompted by Binance’s reports indicating that over $250 billion in annual trades were executed by Pakistani users. As the government plays catch-up, it is examining the potential of blockchain technology to reform the country’s $38 billion annual remittance flows and explore the tokenization of sovereign debt.
Ultimately, Pakistan’s success in the crypto domain hinges on its ability to synchronize ambitious initiatives like the proposed National Bitcoin Reserve and energy surplus utilization for mining with effective legal reforms, bolstered energy infrastructure, and the cultivation of public trust in digital assets.
Building the Digital Future: The Path Forward
Pakistan is clearly at a pivotal junction in its approach to cryptocurrency and blockchain technology. The trajectory it sets today will significantly shape the future of its digital economy.
“Our national BTC reserve is a strategic asset, not a trading portfolio; we are in it for the long haul.” Finance Minister Muhammad Aurangzeb noted
This sentiment encourages a patient and strategic outlook toward cryptocurrency, reinforcing that Pakistan’s efforts are not merely opportunistic but are rooted in creating a sustainable digital financial ecosystem for generations to come.
