Pakistan Opens Licensing to International Crypto Firms
Pakistan has formally invited leading global cryptocurrency exchanges and virtual asset service providers (VASPs) to apply for licenses under a newly established federal regulatory framework. The Pakistan Virtual Asset Regulatory Authority (PVARA) issued a call for Expressions of Interest (EoIs) to enable international firms to operate within Pakistan’s emerging digital asset ecosystem.
Bilal bin Saqib, PVARA chair and minister of state for crypto and blockchain, described the invitation as a step toward building a “transparent and inclusive digital financial future for Pakistan.” The move signals the country’s intent to integrate with global crypto markets while maintaining regulatory oversight.
Strict Criteria for Entry
Applications are restricted to firms already licensed by established authorities, including the US Securities and Exchange Commission (SEC), the UK Financial Conduct Authority (FCA), the European Union’s VASP framework, the UAE’s Virtual Assets Regulatory Authority, and the Monetary Authority of Singapore (MAS).
Prospective applicants must provide detailed company profiles, proof of existing licenses, descriptions of proposed services (such as trading, custody, and payments), technology and security standards, assets under management, revenue figures, compliance history, and a business model tailored to the Pakistani market.
Regulatory Objectives and Framework
PVARA, created under the Virtual Assets Ordinance 2025, is responsible for licensing, regulating, and supervising VASPs in Pakistan. The authority’s mandate aligns with international standards set by the Financial Action Task Force (FATF), International Monetary Fund (IMF), and World Bank.
The framework aims to mitigate illicit financial activities while unlocking opportunities in fintech, remittances, tokenization, and Shariah-compliant financial products through regulatory sandboxes.
Pakistan’s Rapid Crypto Adoption and Strategic Initiatives
Pakistan has emerged as a leading crypto market, ranking third globally in Chainalysis’ 2025 Global Crypto Adoption Index, up six places from previous years. This rapid growth underscores the country’s increasing engagement with digital assets.
In May, Pakistan announced plans to establish a government-led Bitcoin Strategic Reserve, reflecting a shift toward a pro-crypto regulatory stance. Additionally, the government has allocated 2,000 megawatts of surplus electricity to support Bitcoin mining and artificial intelligence centers. This initiative, driven by the Pakistan Crypto Council and supported by the Ministry of Finance, seeks to leverage energy resources for technological advancement.
Challenges and International Concerns
Despite these ambitions, the IMF has expressed reservations about Pakistan’s plan to provide subsidized electricity to energy-intensive crypto mining operations, including Bitcoin miners. The IMF’s concerns highlight the potential economic and regulatory risks associated with such policies.
As Pakistan navigates this complex landscape, the success of its regulatory framework will depend on balancing innovation with compliance and international standards.
FinOracleAI — Market View
Pakistan’s invitation to global crypto firms represents a significant step toward formalizing and expanding its digital asset market. By setting stringent licensing requirements aligned with international regulators, PVARA aims to attract reputable players while mitigating risks related to illicit finance. However, challenges remain, particularly regarding energy use for mining and IMF scrutiny, which could impact operational costs and regulatory approvals.
Market participants should monitor the implementation of licensing procedures, the response from international VASPs, and any evolving government policies on crypto mining incentives. These factors will shape Pakistan’s crypto ecosystem trajectory in the near term.
Impact: positive
