Cryptocurrency operators given deadline to seek NOCs

KARACHI: The Pakistan Virtual Assets Regulatory Authority (PVARA) has set Sept 5 as the deadline for existing virtual asset service providers (VASPs) to submit applications for no-objection certificates (NOCs), warning that those failing to do so would have to cease operations.

“Existing virtual asset service providers must submit their NOC applications by Sept 5, 2026 or cease operations,” PVARA said in a press release.

Virtual assets or virtual currencies are not popular at the mass level in Pakistan, but financial sector watchers said several billion dollars had been invested by Pakistanis in the business.

The government is quick to take several measures to regulate virtual assets, while the State Bank also took a number of measures in this regard.

The PVARA said Pakistan’s virtual asset licensing regime was now live. “In under six months, Pakistan has moved from primary legislation to notified regulations and an open licensing process,” it added.

The crypto assets sector has primarily been spearheaded and managed under the Ministry of Finance. The ministry helped launch the Pakistan Crypto Council (PCC) and established the autonomous PVARA to oversee licensing, compliance and digital asset policies.

Pakistan is opening the front door to the global digital asset economy, with clear rules, regulatory oversight and accountability.

The State Bank officially replaced its earlier restrictions on virtual currencies by issuing instructions allowing regulated banks to open accounts for PVARA-licensed VASPs and their customers.

The newly established PVARA oversees statutory licensing, supervision and legal compliance for digital asset entities.

The State Bank has instructed banks to maintain separate, non-remunerative rupee client accounts for licensed providers to ensure funds are not commingled.

Financial institutions are required to also enforce rigorous anti-money laundering (AML), know-your-customer (KYC) and risk-profiling standards.

Bankers said investment in crypto assets was highly risky as well as highly profitable because cryptocurrency prices fluctuated to a great magnitude. They said this was the reason all major central banks around the world remained reluctant to regulate virtual assets.

The State Bank has directed commercial banks to remain strictly prohibited from trading, investing in or holding virtual assets using their own capital or customer deposits.

Bank involvement is restricted to providing banking rails and transaction monitoring for authorised operators.