PVARA says any deals, pilots involving virtual assets require prior authorisation

The Pakistan Virtual Assets Regulatory Authority (PVARA) said on Monday that any agreement or pilot announced involving virtual assets required prior authorisation.

Earlier this month, the State Bank of Pakistan (SBP) had announced a significant policy change, legalising and encouraging the use of virtual assets through the enactment of the Virtual Assets Act 2026. Under the Act, PVARA is the statutory authority responsible for the licensing, regulation, supervision and oversight of virtual asset activities in Pakistan.

In an advisory published on Monday, the authority said it had noted recent public announcements by financial institutions regarding memoranda of understanding, pilots and partnerships involving virtual assets, including the use of stablecoins for remittances and cross-border payments.

“Under the Virtual Assets Act, 2026, the provision of virtual asset services to users in Pakistan, including the issuance, transfer, custody, exchange, or arrangement of virtual assets, stablecoins, and allied blockchain-based solutions, falls within the regulatory ambit of PVARA,” the authority said.

“Any agreement or announced pilot that results in, or directly enables, the provision of such services requires prior authorisation from PVARA,” it added.

It further emphasised that public announcements of such initiatives without prior engagement with the authority might “give rise to regulatory, reputational and Financial Action Task Force (FATF) compliance risks”, including the possibility that the proposed activity might “not lawfully proceed”.

It said that it was committed to enabling “responsible innovation”.

“Any person (whether natural or legal) contemplating virtual asset pilots, stablecoin use cases, blockchain-based allied solutions, or tokenisation structures should engage early with PVARA through the regulatory sandbox, no-action relief letters, or the no-objection certificate process, and to seek prior authorisation,” it said.