Pakistan Enacts Virtual Assets Act 2026, Establishes PVARA

Pakistan has formally enacted the Virtual Assets Act 2026, introducing a comprehensive legal and regulatory framework for the governance of the country’s digital asset and virtual finance ecosystem. The enactment of this legislation also fulfills a policy commitment associated with International Monetary Fund (IMF) programme requirements relating to financial sector transparency and regulatory oversight.

The statute, which has recently received parliamentary approval, provides for the establishment of the Pakistan Virtual Assets Regulatory Authority (PVARA) as the principal regulatory body responsible for supervising virtual asset markets and digital asset service providers operating within or from Pakistan.

Prior to the passage of this legislation, PVARA had been constituted in July 2025 through a presidential ordinance. However, the promulgation of the Virtual Assets Act 2026 now grants the authority a permanent statutory mandate and formalizes its regulatory powers.

Under the framework introduced by the Act, PVARA will be responsible for licensing virtual asset service providers (VASPs) engaged in activities such as digital asset trading, custody, exchange, and related financial services. The authority will also exercise supervisory oversight over virtual asset markets to ensure compliance with applicable legal, financial, and operational standards.

In addition to licensing and supervisory functions, the legislation incorporates safeguards designed to mitigate risks associated with money laundering and terrorist financing within the digital asset ecosystem. These provisions are intended to enhance regulatory scrutiny and align the virtual assets sector with established financial integrity standards.

According to officials, the regulatory structure established under the new law seeks to balance effective oversight with the promotion of innovation in financial technology. The framework is designed to facilitate the responsible growth of digital financial services while ensuring adequate monitoring of market participants.

The Pakistan Virtual Assets Regulatory Authority has also been vested with enforcement powers aimed at promoting transparency, safeguarding financial stability, and ensuring that licensed operators adhere to regulatory obligations and compliance requirements.

Regulatory authorities have further indicated that the legislation brings Pakistan’s digital asset governance regime closer to internationally recognized standards for the supervision of virtual assets and related financial activities.