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Behind the Scenes: Pakistan’s New Crypto Regulation Era

By HTG
Behind the Scenes: Pakistan’s New Crypto Regulation Era

“We are regulating not to catch up, but to lead.” — Muhammad Aurangzeb, Federal Finance Minister

1. Two New Bodies, One Grand Strategy

| Body | Launched | Legal Form | Core Mandate | |------------------------------------------|-----------------|-------------------------------------------------------------|------------------------------------------------------------------------------| | Pakistan Crypto Council (PCC) | 14 March 2025 | Government-backed policy & promotion council | Draft national strategy, attract investment, run pilots | | Pakistan Virtual Assets Regulatory Authority (PVARA) | 8 July 2025 | Autonomous regulator under Virtual Assets Ordinance, 2025 | Licence, supervise, and enforce compliance for every crypto service provider |

Think of PCC as the think-tank and PVARA as the cop on the beat.

2. Who Sits at the Table? (Org-Chart Snapshot)

PCC Leadership

  • Chairman: Muhammad Aurangzeb (Finance Minister)
  • CEO: Bilal Bin Saqib (now Special Assistant to PM with Minister of State rank)
  • Strategic Adviser: Changpeng Zhao (ex-CEO Binance)
  • Board: Governor SBP, SECP Chairman, Federal Secretaries (Law & IT)

PVARA Governing Board

  • Chairperson: Appointed by Federal Govt (finance/law/tech expertise)
  • Ex-Officio Members: SBP Governor, SECP Chair, FBR Chair, IT Secretary
  • 2 Independent Directors: Crypto/tech veterans
  • Shariah Advisory Committee: Islamic-compliance rulings for every licensed product

3. Licensing Regime—What It Means for You

| Activity | Licence Needed | Sandbox Option? | Shariah Clearance? | |-------------------|---------------------|---------------------------|---------------------------------| | Crypto Exchange | Category A VASP | Yes (90-day pilot) | Mandatory for Islamic product label | | Mining Farm | Category B Infrastructure | Yes | Optional, but recommended | | Wallet Provider | Category C Custody | No-action letter possible | Mandatory | | DeFi Protocol | Category D Innovation | Sandbox only | Mandatory |

Timeline:

  • Application portal opens 1 Oct 2025
  • Licences issued Q1 2026
  • Grace period ends 30 Jun 2026—unlicensed operators face fines & shutdowns.

4. Compliance Playbook (TL;DR)

  • FATF Travel Rule on every transaction ≥ $1,000
  • Real-time suspicious-transaction reporting via API to PVARA
  • Segregated customer funds in State Bank-approved custodian banks
  • Quarterly audits by Big-4 firms
  • 2,000 MW surplus-energy clause—licensed miners get subsidised electricity

5. Immediate Impact on Key Stakeholders

🇵🇰 Freelancers & Remittance Users

  • Crypto-to-PKR ramps become legal once exchanges obtain VASP-A licences.
  • Expected fee drop: from 8% (informal hawala) to <2% (regulated exchanges).

⛏️ Miners

  • Surplus-energy tariff: $0.04/kWh vs $0.12/kWh commercial for licensed farms
  • Tax holiday: 3-year income-tax exemption for miners who set up before 31 Dec 2025.

🏦 Banks & Fintechs

  • Digital Rupee pilot (CBDC) to run parallel to private stable-coins.
  • Sandbox exemption: banks can test tokenised deposits without full VASP licence.

🌐 Global Investors

  • Single-window clearance via PVARA’s InvestPak Crypto Portal (English & Chinese UX).
  • Strategic Bitcoin Reserve: Pakistan plans to hold 1% of forex reserves in BTC—advised by Zhao.

6. How to Get Ready—Week-by-Week Road-Map

| Week | Action | |------|---------------------------------------------------------------------------| | 1 | Register on PVARA portal (opens 1 Oct) → submit intent-to-license form | | 2 | Legal housekeeping: incorporate local entity, draft AML/CFT manual | | 3 | Technical audit: segregated wallets, API hooks for real-time reporting | | 4 | Shariah application: submit product white-paper to Shariah Advisory Committee | | 5 | Sandbox entry (if DeFi/mining) → 90-day pilot with relaxed capital rules |

7. Toolkit & Resources (All Free)

| Need | Link | |-----------------------------|-------------------------------| | VASP licence checklist | pvara.gov.pk/apply | | AML template | FATF Pakistan Toolkit | | Surplus-energy application| NTDC surplus portal | | Shariah ruling request | Shariah Advisory PVARA |

8. Bottom Line

  • Pakistan has moved from regulatory limbo to structured enablement in under six months.
  • PCC attracts talent and capital.
  • PVARA enforces rules that protect consumers and unlock innovation.
  • Early movers (licences filed before 31 Dec 2025) enjoy tax holidays, cheap power, and first-mover credibility.
  • Latecomers risk fines, shutdowns, and reputational damage.

“The window is open now—step through it before the shutters come down.”