Pakistan's parliament passed the Virtual Assets Act 2026 as a presidential ordinance establishing its crypto regulator was days from lapsing, converting a temporary measure into permanent legislation with criminal penalties for unlicensed operators.
President Asif Ali Zardari signed the bill into law, completing a legislative process that cleared the Senate on February 27 and the National Assembly on March 3.
The legislation arrives in a country that banned cryptocurrency in 2018 and now estimates roughly 40 million active domestic users - one of the larger cryptocurrency user bases in the developing world.
What Happened
The Virtual Assets Act permanently establishes the Pakistan Virtual Assets Regulatory Authority (PVARA) as an autonomous statutory body with powers to license, supervise, and revoke authorization for exchanges, custodians, token issuers, and other service providers.
PVARA had been created by presidential ordinance in July 2025; without the new law, that ordinance would have lapsed in early March 2026.
Under the Act, unlicensed cryptocurrency operations now carry criminal penalties of up to PKR 50 million (~$179,000) and five years imprisonment. Unauthorized virtual asset offerings or promotions face a separate PKR 25 million (~$89,000) fine and up to three years in prison. PVARA may also designate special "virtual asset zones" to attract blockchain firms, though no zones have been designated yet.
Applicants for full licenses must already hold regulatory recognition from a major jurisdiction - the U.S., EU, or Singapore - meet minimum capital requirements, and ensure compliance with Sharia law under a committee of Islamic finance scholars.
Read also: Bank Of Canada Completes CA$100M Tokenized Bond Pilot - But Warns Adoption Will Be Slow
Why It Matters
Binance and HTX each received No Objection Certificates from PVARA in December 2025, allowing them to register with Pakistan's Financial Monitoring Unit for anti-money laundering compliance while preparing full license applications.
Neither is yet permitted to operate commercially.
In January 2026, Pakistan also signed a memorandum of understanding with a firm linked to World Liberty Financial - a cryptocurrency project associated with U.S. President Donald Trump's family - to explore a dollar-backed stablecoin for cross-border payments. That arrangement remains at the MOU stage.
Pakistan's rapid regulatory push follows years of informal, high-volume cryptocurrency use that the government was largely unable to tax or monitor. PVARA's framework aligns with Financial Action Task Force standards, which Pakistan has historically been under pressure to meet.
Read next: Backtested Data Shows Bitcoin DCA Outperformed S&P 500 Over 5 Years