Virtual Assets Act, 2026

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THE VIRTUAL ASSETS ACT, 2026 
                                            
                                                           CONTENTS 
 
Chapter I 
PRELIMINARY 
1.  Short title, extent, commencement 
2.  Scope of application 
3.  Definitions 
4.  Extraterritorial application 
5.  Relationship with other laws 
Chapter 2 
PAKISTAN VIRTUAL ASSETS REGULATORY AUTHORITY 
6.  Establishment of the Authority 
7.  Composition of Authority 
8.  Procedures of the Authority 
9.  Objectives, functions and powers of the Authority 
10.  Delegation of powers 
11.  Appointment and Functions of Chairperson 
12.  Appointment and Functions of Managing Director 
13.  Appointment of Officers, Staff, Consultants, Advisors and other personnel 
14.  Pakistan Virtual Asset Regulatory Authority Fund 

 
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15.  Budget, Finance and Audit 
16.  Code of conduct 
17.  Inter-agency cooperation and information-sharing 
Chapter 3 
LICENSING OF VIRTUAL ASSET SERVICE PROVIDERS AND ISSUANCE OF VIRTUAL 
ASSETS 
18.  Categories of virtual asset services 
19.  Application for License 
20.  Fit-and-proper criteria 
21.  Grant, refusal and terms of license 
22.  Ongoing obligations of licensees 
23.  Variation, suspension and revocation of license 
Chapter-4 
PRUDENTIAL REQUIREMENTS, SAFEGUARDING AND CUSTODY 
24.  Segregation of customer assets 
25.  Minimum financial resource requirements 
26.  Custody standards and key-management controls 
27.  Proof-of-reserves and audit obligations 
28.  Reserve custodians 
29.  Customer safeguard or compensation mechanism 
Chapter-5 
FIAT-REFERENCED AND ASSET-REFERENCED TOKENS 
30.  Initial Virtual Asset Offerings 
31.  Issuance Requirements for Fiat-Referenced Tokens 
32.  Issuance Requirements for Asset-Referenced Tokens 
33.  Significant issuers 
Chapter-6 
CYBERSECURITY, SANDBOX AND INNOVATION 
34.  Cybersecurity and operational resilience 
 
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35.  Regulatory sandbox 
36.  Oversight of blockchain technology adoption 
37.  Regulation of Virtual Asset Mining Activities 
38.  Establishment of Strategic Digital Wallet Company 
39.  Data localization framework 
40.  Data segregation and protection of sensitive information 
Chapter-7 
MARKET CONDUCT, CONSUMER PROTECTION 
41.  Duty of integrity and fair dealing 
42.  Obligations of issuers of Virtual Assets 
43.  Marketing and conduct restrictions 
44.  Conflict-of-interest management 
45.  Complaint-handling and dispute resolution 
Chapter-8 
ANTI-MONEY LAUNDERING, COUNTERING OF TERRORISM FINANCING AND 
COUNTERING OF PROLIFERATION FINANCING 
46.  Application of Anti-Money Laundering Act, 2010 
47.  Travel rule and record-keeping obligations 
48.  Real-time data access and reporting 
49.  Data Privacy Obligations for Licensed entities 
Chapter-9 
Prohibitions 
50.  Prohibition of unlicensed Virtual Asset services 
51.  Prohibition on Initial Virtual Asset Offerings 
52.  Prohibition of market manipulation and insider trading 
53.  Prohibition on Algorithmic tokens 
Chapter-10 
ENFORCEMENT, OFFENCES AND PENALTIES 
54.  Criminal offences 
 
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55.  Liability of officers of bodies corporate 
56.  Power to Investigate 
57.  Powers of Authorized Officer 
58.  Prosecution of offences 
59.  Administrative sanctions 
60.  Emergency intervention powers 
61.  Power to prevent access to unlicensed virtual asset services 
Chapter-11 
APPEALS 
62.  Establishment of the virtual assets appellate tribunal 
63.  Jurisdiction 
64.  Appeal 
65.  Appeal to Supreme Court 
Chapter-12 
MISCELLANEOUS 
66.  Tax Compliance 
67.  Power to make Rules 
68.  Powers to make regulations 
69.  Officers to be Public Servants 
70.  Transitional provisions 
71.  Power of the Federal Government to issue policy directives 
72.  Annual and special reports of the Authority 
73.  Removal of difficulties 
74.  Savings 
SCHEDULE-I 
 
 
 
 
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THE VIRTUAL ASSETS ACT, 2026 
ACT NO. XIII OF 2026 
[4th March, 2026] 
AN 
ACT 
to establish a regulatory Authority for the licensing, regulation and supervision of Virtual Assets and 
Virtual Asset Service Providers 
WHEREAS it is expedient to establish a dedicated Virtual Assets Regulatory Authority to 
license, regulate and supervise Virtual Assets and Virtual Asset Service Providers, in order to ensure 
investor protection, transparency and market integrity in Pakistan; 
AND WHEREAS, it is necessary to provide a comprehensive legal framework to empower the 
Authority to combat money laundering, terrorist financing, proliferation financing and other illicit 
activities involving Virtual Assets, in accordance with international standards, and to provide for matters 
connected therewith or ancillary thereto; 
It is hereby enacted as follows: - 
Chapter I 
PRELIMINARY 
1. Short title, extent, commencement .—(1) This Act Shall be called the Virtual Assets Act, 
2026. 
(2) It extends to the whole of Pakistan. 
(3) It shall come into force at once. 
2. Scope of application.—(1) This Act shall apply to— 
(a)  any Virtual Asset Service Provider that carries on, or holds itself out as carrying 
on, a Virtual Asset Service in or from Pakistan; and 
(b)  any Issuer that offers, originates or distributes, on its own behal f, a Virtual Asset 
in or from Pakistan. 
(2) For the avoidance of doubt, this Act shall not apply to the following digital representations of 
value or rights, insofar as they meet the conditions stated below— 
(a)  closed-ecosystem or closed -loop digital tokens, including any digital 
representation of value or rights that, by design, technical architecture, or 
enforceable system controls, satisfies all of the following conditions— 
 
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(i)  is usable or redeemable solely within a restricted digital platform, 
ecosystem, application, or network administered by the issuer or operator; 
(ii)  is not transferable outside such platform, ecosystem, application, or 
network, whether directly or indirectly; 
(iii)  is not exchangeable for fi at currency or legal tender outsi de such 
ecosystem; 
(iv)  is not redeemable for real-world goods or services outside such ecosystem; 
(v)  is not convertible into, exchangeable for, or interoperable with any other 
Virtual Asset; 
(vi)  is not saleable, tradable, or transferable on any external market, exchange, 
or secondary trading venue; or 
(vii)  is not designed, marketed, or used for payment, investment, or value -
transfer purposes beyond such ecosystem. 
(b)  securities, derivatives, collective investment schemes, depositary receipts, or 
other traditional financial instruments that fall within the regulatory jurisdiction 
of the State Bank of Pakistan or the Securities and Exchange Commission of 
Pakistan; 
(c)  digital representations of fiat currency issued by the State Bank of Pakistan or any 
central bank or monetary authority of another sovereign jurisdiction; 
(d)  a non -fungible token that is not used for payment or investment and does not 
represent, reference, or derive value from any security, commodity, financial 
asset, or other regulated instrument; 
(e)  any non -fungible token or digital collectible that does not constitute a Virtual 
Asset, having regard to its substance, function, or economic effect; or  
(f)  any other digital representation of value or rights expressly excluded by the  
Authority. 
3. Definitions.—(1) In this Act, unless there is anything repugnant in the subject or context: 
(i)  “Asset-Referenced Token ” means a Virtual Asset that represents, directly or 
indirectly, ownership rights, claims, or economic interests, including entitlements 
to receive or share income, returns, or other economic benefits, in respect of one 
or more underlying assets, or is designed to maintain a stable value by reference 
to such underlying assets. 
(ii)  “Authority” or “PVARA” means the Pakistan Virtual Asset Regulatory Authority 
established under this Act; 
 
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(iii) “Blockchain” or “Distributed Ledger Technology” or “DLT” means a technology 
that en ables a distributed ledger, an i nformation repository that records 
transactions or data across mu ltiple nodes in a synchronized manner using 
cryptography to ensure integrity, tamper-resistance, immutability, and consensus 
among participants, as may be further defined by Regulations; 
(iv)  “Chairperson” means the Chairperson of the Authority appointed under this Act; 
(v)  “Controller” means a Person who, alone or together with associates, holds or is 
entitled to exercise twenty percent (20%) or more of the voting power, ownership 
interest, or share capital of a Licensee, or otherwise exercises significant influence 
or control over its management or policies, whether directly or indirectly; 
(vi)  “Customer” means any natural or legal person who obtains or uses a Virtual Asset 
Service from a Licensee, or who enters into a business or contractual relationship 
with a Licensee for the provision of such service, whether on a one-off or ongoing 
basis; 
(vii) “Customer Assets ” means Virtual Assets and fiat currency belonging to a 
customer that a Virtual Asset Service Provider holds, safeguards, or otherwise has 
custody or control over on that cus tomer’s behalf, and excludes assets owned by 
the Virtual Asset Service Provider; 
(viii) “Division concerned ” means the Cabinet Division as defined in the Rules of 
Business, 1973; 
(ix) “Fiat-Referenced Token” means a Virtual Asset that purports to maintain a stable 
value relative to a single Official Currency of any country and is redeemable at 
par value by its Issuer; 
(x)  “High-Quality Liquid Assets” or “HQLA” means such high-quality liquid assets 
as may be prescribed by Regulations; 
(xi)  “Inside information” means non-public information likely to affect virtual asset 
prices if disclosed, including client orders, trading intentions, or decisions related 
to issuance or facilitation, as may be further defined by regulations; 
(xii)  “Insiders” include Controller, officers, directors, employees, or affiliates of 
issuers or Virtual Asset Se rvice Providers with access to i nside information; 
family members; o r other persons obtaining such i nformation unlawfully or 
through employment, and as may be further prescribed by Regulations. 
(xiii)  “Issuer” means the legal Person that originates or creates a Virtual Asset and 
retains primary control over its initial supply, reserve assets (if any) or on -chain 
governance, and may distribute such Virtual Asset as part of its initial offering, 
and that bears the ongoing obligations as prescribed by the Authority. 
 
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Explanation: A Person is not an Issuer solely because it markets, advertises, 
promotes, facilitates secondary-Market trading (including third-party brokerage, 
distribution or exchange), or provides technical development or maintenance 
services without control over issuance, supply or reserve assets. 
(xiv)  “Initial Virtual Asset Offering ” means a method of raising funds b y an Issuer 
through the public offering of Virtual Assets in exchange for funds or other Virtual 
Assets or anything of commercial value, subject to the limitations and disclosure 
requirements Prescribed under this Act; 
(xv)  “Key Individual” means any natural Person who occupies or performs - whether 
on a full-time, part-time, acting or outsourced basis - one or more of the positions 
listed below in relation to a licensee 
(a)  director (executive or non-executive) registered under the Companies Act, 
2017 (XIX of 2017) 
(b)  Managing Director; 
(c)  chief financial officer; 
(d)  chief operating officer; 
(e)  head of internal audit; 
(f)  head of compliance; 
(g)  money-laundering reporting officer (MLRO) or equivalent AML, CFT or 
CPF complia nce officer designed under the AML, CFT and CPF 
Regulations issued pursuant to the Anti-Money Laundering Act 2010 (VII 
of 2010); 
(h)  head of risk management; 
(i)  head of information-security and cyber-security; or 
(j)  any other position that the Authori ty, by written notice to the Licensee, 
declares to be a Key Individual. 
(xvi)  “Licensee” means a person who holds a license under this Act; 
(xvii)  Market Manipulation or Market Abuse means any act, practice or course of 
conduct that: 
(a)  gives false or misleading signals as to the supply, demand or price of one 
or more Virtual Assets; 
(b)  secures the price of Virtual Assets at an abnormal or artificial level; or 
 
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(c)  employs any device, deception or artificial means to interfere with the 
normal operation of supply and demand in Virtual Asset markets, as may 
be further defined by Regulations. 
(xviii)  “Managing Director” means the Managing Director of the Authority, appointed 
under this Act; 
(xix)  “Virtual Asset Mining” means the process of validating or verifying transactions 
and recording them on a distributed ledger or blockchain network, using 
computational or other consensus mechanisms, and, in return, earning virtual 
assets, transaction fees, or other rewards. 
(xx)  “Non-Fungible Token ” or “NFT” means a unique, non -interchangeable digital 
representation of value or rights recorded on a distributed ledger or similar 
technology, where each token is distinguishable from every other token; 
(xxi)  “Official or Fiat Curre ncy” means a currency issued by the central bank or 
monetary authority of a country that is recognized as legal tender under the laws 
of that country; 
(xxii)  “Person” means a natural or legal Person; 
(xxiii) “Prescribed” means prescribed by Rules or Regulations made under this Act; 
(xxiv) “Regulations” means Regulations made under this Act; 
(xxν) “Rules” means Rules made under this Act; 
(xxvi) “Segregated Reserve” means a pool of reserve assets that is kept separate from the 
Issuer’s own assets, held in the name of the Issuer, or in a trust or special vehicle 
for the benefit of token holders, and under custody, with independent custodian or 
regulated financial institution, approved by the authority, so that the Issuer or its 
creditors cannot claim the ass ets. The Authority may, by Regulations, prescribe 
additional requirements regarding the types of assets, custody arrangements, 
audits, attestations, disclosures, and other safeguards; 
(xxvii) “Shariah Advisory Committee” means the committee constituted by the Authority 
for advice on Shariah matters; 
(xxviii) “Special Court ” means a court notified by the Federal Government to take 
cognizance of offence as mentioned under this Act; 
(xxix) “Sponsor” means a person or group of persons who has contributed initial capital 
to establish the company or hold a controlling shareholding therein, whether 
directly or indirectly; 
(xxx)  “Tribunal” means a Tribunal constituted under this Act; 
(xxxi)  “Virtual Asset” means a digital representation of value that can be digitally traded 
or transferred and used for payment or investment purposes, but does not include 
 
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digital representations of fiat currency, securities or other financial assets 
regulated under any other law except where represented, issued, or transferred 
using distributed ledger technology. For the avoidance of doubt, Virtu al Assets 
are not legal tender; 
(xxxii) ”Virtual Asset services” means the categories of services set out in section 18 of 
this Act; and 
(xxxiii) “Virtual Asset Service Provider” means any Person who, as a business, provides 
one or more Virtual Asset Services to third parties on a professional basis. 
(2) All other words and expressions not defined in this Act but defined in the State Bank of 
Pakistan Act, 1956 (XXXIII of 1956), the Securities Act, 2015, (III of 2015) the Anti-Money Laundering 
Act, 2010 (VII of 2010), or the Companies Act, 2017 (XIX of 2017) shall, unless the context otherwise 
requires, have the meanings assigned to them in those Acts. 
4. Extraterritorial application. —(1) For the purposes of investigation and enforcement under 
this Act, the Authority may exercise its powers extraterritorially to the fullest extent permitted by law. 
(2) In order to facilitate enforcement under this section and the effective regulation of Virtual 
Asset Services with cross-border implications, the Authority may enter into agreements or arrangements 
with regulatory authorities and law enforcement agencies in other jurisdictions for mutual assistance, 
information sharing, and the recognition and enforc ement of regulatory decisions, and shall, by 
Regulations, prescribe the conditions under which a Virtual Asset Service conducted outside Pakistan 
shall or shall not be deemed to be offered or marketed to Persons in Pakistan. 
(3) The Authority shall, where applicable, align its extraterritorial enforcement practices with 
mutual legal assistance treaties and international cooperation frameworks, including those of the 
Financial Action Task Force and International Organization of Securities Commissions (IOSCO). 
5. Relationship with other laws. —(1) The provisions of this Act are in addition to, and not in 
derogation of, any other law for the time being enforce. In the event of any inconsistency with any other 
law, other than the Foreign Exchange Regulation Act, 1947 (VII of 1947), this Act shall prevail except 
as provided below. 
(2) Where any law prescribes measures relating to data protection, data governance, or 
cybersecurity, financial secrecy or cross -border transfer of personal data, such provisions shall pr evail 
and be complied with by the Authority and Licensees. 
(3) The regulation and supervision of Virtual Assets, Virtual Asset Service Providers, 
tokenization of real-world assets, and blockchain technology shall vest primarily in the Authority under 
this Act, in coordination with other relevant regulators where applicable. 
 
 
 
 
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Chapter-2 
PAKISTAN VIRTUAL ASSETS REGULATORY AUTHORITY 
6. Establishment of the Authority.—(1) After the commencement of this Act, an authority shall 
be established to be known as the Pakistan Virtual Assets Regulatory Authority, which shall carry out 
the purposes of this Act. 
(2) The Authority shall be a body corporate with perpetual succession and a common seal and 
may sue and be sued in its name. 
(3) The Authority shall be autonomous  in the performance of its functions and exercise of its 
powers, subject to this Act. 
(4) The headquarters of the Authority shall be at Islamabad, and it may set up as many offices 
across Pakistan as required. 
7. Composition of Authority.— (1) The Authority shall consist of the following, namely:— 
(a)  Chairperson - to be appointed by the Federal Government 
(b)  the Secretary, Ministry of Finance; 
(c)  the Secretary, Ministry of Law and Justice; 
(d)  the Governor, State Bank of Pakistan; 
(e)  the Chairperson, Securities and Exchange Commission of Pakistan; 
(f)  the Chairman, National AML-CFT Authority; 
(g)  the Chairperson, Pakistan Digital Authority; and 
(h)  two independent directors with proven expertise and a strong track record 
possessing expertise relevant to Virtual Asset markets, digital technology, digital 
finance, appointed by the Federal Government in the manner Prescribed. 
(2) The members of the Authority, other than ex-officio members, shall hold office for a term of 
three years and shall be eligible for one further term of three years. 
(3) The Authority shall determine its own policy and strategic direction and approve its budget 
and Regulations. 
8. Procedures of the Authority. —(1) The Authority may meet any time on requisition of the 
Chairperson or at requisition of at least fifty percent of the members. Provided however, the Authority 
shall meet at least twice a year. 
(2) The quorum of the Authority's meeting shall be at fifty percent of the total membership with 
the mandatory presence of the (a) (b) and (d) as mentioned in section 7. 
(3) A meeting of the Authority shall be presided over by the Chairperson. In the absence of the 
Chairperson, a member nominated by the Chairperson shall preside over the meeting. 
 
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(4) All decisions in the meeting shall be made with majority of the present members. 
9. Objectives, functions and powers of the Authority.—(1) The Authority shall:— 
(a)  license, regulate and supervise Virtual Asset Service Providers and issuers in 
accordance with the provisions of this Act and any Rules or Regulations made 
thereunder, 
(b)  protect customers and investors and the Integrity of Pakistan's Virtual Asset 
markets by establishing and enforcing appropriate safeguards and conduct of 
business requirements, prudential, operational-resilience, risk -management 
standards, and measures to prevent money laundering, terrorist financing and 
other illicit use of Virtual Assets; 
(c)  attract investment and encourage companies operating in the fields of Virtual 
Assets to base their business in Pakistan; 
(d)  promote responsible innovation, digital financial inclusion and the development 
of compliant Virtual Asset markets within a framework that manages risks and 
supports financial stability and market integrity; 
(e)  promote, develop, govern, and regulate the adoption, deployment, and scalable 
use of blockchain technology and distributed ledger technology across Pakistan; 
(f)  assess, determine, and classify any Virtual Asset, service, activity, offering, 
Issuer, or service provider based on its substantive features, underlying function, 
method of use, or economic effect, irrespective of the nomenclature, structure, or 
designation assigned to it. Such classification may include, but is not limited to 
the determination of whether an asset is a Virtual Asset, whether a Person qualifies 
as a Virtual Asset Service Provider, or whether an offering constitutes a financial 
activity within the scope of this Act subject to consultation with the State Bank of 
Pakistan or the Securities and Exchange Commission of Pakistan where the asset 
exhibits characteristics falling within their respective mandates; 
(g)  coordinate with the Financial Monitoring Unit, National AML and CFT 
Authority, other relevant authorities and law enforcement agencies to co mbat 
money laundering, terrorist financing, and other illicit activities associated with 
Virtual Assets, in accordance with the Anti-Money Laundering Act, 2010 (VII of 
2010), other applicable laws, and international standards; 
(h)  advise the Federal Government, on its own motion or upon request, on regulatory, 
supervisory, technical or emerging risk matters relating to Virtual Assets, digital-
asset markets, tokenisation, stablecoin structures, blockchain, DLT, cyber-risks or 
any matter connected with its mandate under this Act; and 
(i)  do all such acts as may be necessary or incidental to the discharge of its functions 
and to achieve its objectives under this Act and other applicable laws. 
 
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(2) For the purposes of sub-section (1), and without prejudice to the generality of the foregoing, 
the Authority may— 
(a)  make Regulations, standards, directives, guidelines, handbooks and circulars, or 
any other instrument, consistent with the objectives of this  Act and other 
applicable laws; 
(b)  set prudential, conduct operational resilience, risk -management, cybersecurity, 
data protection & technical standards; 
(c)  issue, vary, suspend or revoke licenses, approvals or directives under this Act and 
prescribe conditions for such actions; 
(d)  prescribe licensing conditions, eligibility criteria, renewal requirements and any 
additional obligations for Licensees; 
(e)  conduct on-site inspections and off-site monitoring of Licensees and other entities 
to ensure compliance with this Act and relevant Rules and Regulations; 
(f)  require Licensees to furnish information, documents and data in the manner and 
timeframe reasonably Prescribed by Regulations; 
(g)  ensure compliance of data -protection, data -governance and cyber security 
obligations by Virtual Asset Service Providers subject to supervisory follow-up; 
(h)  impose administrative sanctions in accordance with the provisions of this Act and 
any Rules or Regulations made thereunder; 
(i)  apply to court for civil or criminal remedies as provided under any applicable law; 
(j)  levy such fees, charges and penalties as may be Prescribed by Rules; 
(k)  operate regulatory sandboxes in a transparent and accountable manner; 
(1)  enter into cooperation or mutual assistance arrangements with domestic and 
foreign regulators and law enforcement agencies to facilitate Information sharing 
and coordinated action, including mutual recognition of Regulations and licenses; 
(m)  conduct public education and awareness initiatives to promote informed 
participation in the Virtual Asset ecosystem; and 
(n)  constitute as many committees as deemed necessary to conduct its functions under 
this Act. 
10. Delegation of powers.—The Authority may delegate any of its powers and functions to the 
Managing Director, subject to such terms, conditions, and limitations as it may deem appropriate. 
11. Appointment and Functions of Chairperson.— (1) The Chairperson of the Authority shall 
be appointed by the Federal Government on such terms and conditions as it may deem fit. The 
Chairperson shall have demonstrable expertise in digital finance or technology and a minimum of three 
 
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years' relevant professional experience, and shall be eligible for re-appointment for maximum two terms 
on such term or terms as the Federal Government may determine. 
(2) The Chairperson shall provide overall guidance, direction, and oversight of the Authority. 
(3) The Chairperson shall only be removed prior to the expiry of the term for gross misconduct 
or incapacity following a show cause notice and opportunity to be heard. 
(4) The Chairperson may resign by writing to the Prime Minister. 
12. Appointment and Fun ctions of Managing Director. —(1) The Authority shall  appoint a 
Managing Director for a term of three years, extendable for a further maximum of two term of three 
years only. 
(2) The Managing Director shall be a person of proven integrity and competence, and shall meet 
such qualifications, criteria, and requirements as may be prescribed by Regulations. 
(3) The Managing Director shall act as Secretary of the Authority for its pr oceedings but shall 
not have voting rights unless specifically authorized. 
13. Appointment of Officers, Staff, Consultants, Advisors and other personnel. —(1) The 
Authority may, from time to time, create and sanction such posts, prescribe required qualifica tions and 
experience, and determine terms of service through Regulations as required. 
(2) The Authority may, through a transparent and competitive process prescribed by Regulations, 
appoint such employees, officers, consultants, and technical or professional advisers as are necessary for 
the performance of its functions and the exercise of its powers under this Act. 
(3) The Authority may, as prescribed by Regulations, request any Ministry, Division, public 
authority, public entity or autonomous or regulatory body to assign an official with requisite expertise to 
the Authority for such period as may be mutually agreed. 
14. Pakistan Virtual Asset Regulatory Authority Fund. —(1) There shall be established a 
lapsable fund, vested in and administered and controlle d by the Authority, to be known as the Pakistan 
Virtual Asset Regulatory Authority Fund, for meeting expenditures in connection with the performance 
of the functions and operations of the Authority under this Act. 
(2) Subject to the provisions of the Public Finance Management Act, 2019 (V of 2019), the Fund 
shall consist of— 
(a)  funds provided by the Federal Government for salaries, infrastructure, 
administrative, operational, and other expenses, including the day -to-day 
functioning of the Authority; 
(b)  loans or funds obtained from the Federal Government, any Provincial 
Government, a local authority or any other entity with the approval of the 
Authority; 
(c)  grants made by the Federal Government; 
 
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(d)  aids, grants, donations, or loans raised or obtained by the Authority from domestic 
and international agencies, in consultation with the Division to which the business 
of finance stands allocated and other relevant Divisions; 
(e)  contributions from multilateral organisations, international agencies, and 
philanthropic organisations for purposes consistent with the objectives of the 
Authority, to be managed in accordance with regulations ensuring tr ansparency 
and good governance; 
(f)  all sums or property which may in any manner become payable to or vested in the 
Authority in connection with the exercise of its powers or performance of its 
functions; 
(g)  income from investments and assets of the Authority; 
(h)  NOC, licensing, supervision, renewal or other fees received by the Authority; 
(i)  penalties, fines, settlements, and other recoveries imposed or realized under this 
Act or any Rules or Regulations made thereunder; 
(j)  charges for services rendered by the Authority, including sandbox participation 
and other prescribed services; and 
(k)  any other source as may be prescribed. 
(3) The Fund shall be managed and operated in such manner as may be prescribed by Regulations. 
(4) The Fund shall be maintained in such manner and with such institutions as the Authority may 
determine, subject to any requirements prescribed by Regulations. 
(5) The Pakistan Virtual Asset Regulatory Authority Fund may be expended for— 
(a)  paying any expenditure lawfully incurred by the Authority; 
(b)  payment of salaries and other remunerations payable to the chairperson, Managing 
Director, Officers, employees, consultants, and advisers of the Authority; 
(c)  paying any other expenses, costs or expenditures properly incurred or approved 
by the Authority in the performance of its functions or the exercise of its powers 
under this Act; 
(d)  purchasing or hiring equipment, machinery and other materials, acquiring land 
and constructing buildings, and carrying out any other work or undertakings in 
connection with the performance of its functions or the exercise of its powers 
under this Act; 
(e)  repayment of any loans or advances obtained under this Act, together with any 
associated interest, charges or fees; 
 
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(f)  meeting any financial obligations or liabilities that arising out of the performance 
of the functions of the Authority under this Act; 
(g)  funding strategic and enabling projects or initiatives necessary to support the 
objective of this Act or to enhance the operational capabilities of the Authority 
and its stakeholders; 
(h)  meeting expenses relating to investigations, inspectio ns, enforcement actions, 
legal proceedings, arbitration, mediation, and dispute resolution, including court 
fees, expert fees, and legal costs; and 
(i)  capacity-building, research, training, certification, and i nternational cooperation 
activities, including participation in regional or international regulatory forums. 
15. Budget, Finance and Audit. —(1) The Authority shall, in respect of each financial year, 
prepare and approve its budget in accordance with the procedure prescribed through Rules. 
(2) The budget statement shall specifically state the estimated receipts and expenditure and the 
sums which are to be required from the Federal Government during the next financial year. 
(3) The Authority shall maintain complete and accurate books of accounts of its receipts of funds 
and expenditure. 
(4) At the end of each financial year, the accounts of the Authority shall be audited by the Auditor 
General of Pakistan and by a firm of Chartered Accountants nominated by the Auditor General of 
Pakistan. 
(5) The Author ity shall produce such accounts, books and documents and  furnish such 
explanations and information as the auditors may require for the purpose of audit. 
(6) Copies of the auditor's report on the accounts shall be provided to the Authority. 
(7) The Authorit y shall submit an annual report of the fund under this section to the Prime 
Minister through the concerned Division within ninety days of the close of each financial year, including 
audited financial statements and performance against approved objectives, and such other matters as the 
Authority may consider necessary for transparency and accountability. 
16. Code  of conduct. —(1) The Chairpe rson, Members of the Authority i ncluding ex-officio 
Members, Managing Director, officers and employees of the Authority, shall, in the performance of their 
functions, act with integrity, impartiality, confidentiality and in good faith, and shall avoid any conflict 
of interest, whether direct or indirect. 
(2) The Authority shall prescribe, by Regulations, a Code of Conduct applicable to the 
Chairperson, Members of the Authority, Managing Director, officers and employees of the Authority, 
including provisions relating to , disclosure of interests, conflict man agement, restrictions on personal 
trading in Virtual Assets, confidentiality, and post-tenure obligations. 
 
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(3) Any violation of the provisions of this section or the Code of Conduct prescribed thereunder 
shall constitute misconduct and shall result in remo val from office or service, as the case may be, and 
the initiation of disciplinary proceedings. 
17. Inter-agency cooperation and information-sharing.—(1) For the effective regulation and 
supervision of Virtual Assets and Virtual Asset Service Providers, an d to prevent their misuse, the 
Authority shall cooperate and share supervisory and enforcement information, in a timely and secure 
manner, with the State Bank of Pakistan, the Securities and Exchange Commission of Pakistan, We 
Financial Monitoring Unit, th e Federal Investigation Agency, the Federal Board of Revenue, and any 
other competent regulatory or law-enforcement agencies or bodies. 
(2) The Authority may, with the prior approval of the Federal Government, enter into cooperation 
arrangements or information-sharing arrangements with foreign regulatory or supervisory authorities for 
cross-border supervision, enforcement and mutual assistance relating to Virtual Assets and Virtual 
Assets Service Providers. 
(3) The Authority may establish one or more inter-agency coordination mechanisms, including a 
regulatory coordination committee, comprising representatives of relevant public authorities, to facilitate 
policy coordination, information -sharing, supervision, enforcement, and risk mitigation in relation to 
Virtual Assets and Virtual Asset Service Providers. 
Chapter 3 
LICENSING OF VIRTUAL ASSET SERVICE PROVIDERS AND ISSUANCE OF VIRTUAL 
ASSETS 
18. Categories of virtual asset services. —The following constitute Virtual Asset Services and 
shall be subject to licensing and regulation under this Act: 
(a)  all services as specified in Schedule I; and 
(b)  any other service as may be notified by the Federal Government and subsequently 
included in Schedule I of this Act. 
19. Application for License. —(1) Any Person intending to incorporate a company, under the 
Companies Act, 2017 (XIX of 2017) or any other law for the time being in force, with the primary 
objective of engaging in Virtual Asset Services shall first apply to the Authority for a No -Objection 
Certificate before commencing the process of such incorporation. 
(2) An application for a No -Objection Certificate under sub -section (1) shall be made in such 
form and manner, accompanied by such information and fee as may be prescribed by the Authority. 
(3) Upon review of an application for No-Objection Certificate, the Authority may, having regard 
to the objects of this Act and the need to ensure the integrity of the Virtual Asset market, grant the 
approval or certificate, subject to any conditions, or refuse the application, providing written reasons for 
refusal. 
 
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(4) An application for a license, following incorporation of the company, shall be made to the 
Authority in such form and manner as may be prescribed. It shall be accompanied by- 
(a)  the prescribed fee, which shall be non-refundable unless otherwise determined by 
the Authority; and 
(b)  such information and documents as may be prescribed or required by the 
Authority. 
20. Fit-and-proper criteria.—(1) The Authority shall determine whether a Controller, Sponsor, 
Chief Executive Officer and Director is fit and proper in accordance with criteria prescribed by 
Regulations. 
(2) The fit-and-proper criteria shall apply to all Key Individuals. It shall be the responsibility of 
the applicant for a license or the lice nsee to assess and maintain the fitness and propriety of other key 
individuals not mentioned in sub -section (1), and to submit a written undertaking to the Authority 
confirming compliance and ongoing maintenance thereof. 
(3) The Authority may refuse, suspend or revoke a license where any Controller, Sponsor or Key 
Individual fails to meet the prescribed fit-and-proper criteria. 
(4) Fit-and-proper criteria shall be continuing in nature, and any person subject to such criteria 
shall notify the Authority of any matter that may affect their fitness and propriety. 
(5) The Authority shall prescribe additional requireme nts for corporate Controllers, i ncluding 
assessment of the corporate behaviour, i ntegrity and track record of Controller and ultimate beneficial 
owners. 
(6) Every Licensee shall maintain a registered office in Pakistan and ensure that at least one Key 
Individual ordinarily resident in Pakistan is vested with operational and decision -making authority 
subject to conditions prescribed. 
21. Grant, refusal and terms of license.—(1) Subject to this Act and any Rules or Regulations 
made thereunder, the Authority may— 
(a)  grant a license, subject to such terms and conditions as it may deem appropriate; 
or 
(b)  refuse the application, providing the applicant w ith written reasons for such 
refusal. 
(2) The Authority may, on a case-by-case basis, grant a provisional or a limited-scope licence to 
an applicant, subject to such terms and conditions as may be prescribed. 
(3) A license granted to a Virtual Asset Service Providers shall specify the Virtual Asset Services 
that is permitted to undertake and shall remain in force unless suspended or revoked. 
 
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(4) The Authority shall maintain and publish an up -to-date register of Licensees on its official 
website. The registe r shall include, at a minimum, the name, license number, permitted services and 
current regulatory status of each Licensee. 
22. Ongoing obligations of licensees.—A Licensee shall, at all times— 
(a)  maintain the prescribed minimum paid-up capital and financial resources; 
(b)  comply with this Act and all Rules, Regulations, directives and guidelines issued 
by the Authority; 
(c)  submit such periodic returns, reports and audited financial statements as may be 
prescribed; 
(d)  obtain the prior approval of the  Authority for any material change in control or 
business, in the manner prescribed; 
(e)  maintain risk-management, compliance and cybersecurity systems in accordance 
with applicable legal and regulatory requirements including adherence to data 
privacy standards; and 
(f)  pay such supervision, renewal or other fees as may be prescribed. 
23. Variation, suspension and revocation of license. —(1) The Authority may, by way of 
written notice and after providing an opportunity of being heard, vary, suspend or revo ke a license if it 
is found that— 
(a)  the Licensee has contravened any provisions of this Act or any other applicable 
laws, or any terms or condition of its license; 
(b)  the Licensee is insolvent or no longer satisfies the fit-and-proper criteria; 
(c)  the Licensee has ceased to carry on the Virtual Asset Service for which it is 
licensed; or 
(d)  such action is necessary or expedient in the public interest, including for the 
protection of consumers, the integrity of the market, or financial stability, or 
(e)  the license was obtained by fraud, misrepresentation, or  concealment of material 
facts. 
(2) Where a license is revoked, the Licensee shall immediately cease the provision of Virtual 
Asset Services, and the Authority may notify the Securities and Excha nge Commission of Pakistan to 
initiate winding-up or dissolution proceedings in accordance with the Companies Act, 2017 (XIX of 
2017) and any Regulations that may be prescribed under this Act. 
(3) The Authority may, by Regulations prescribe further procedu res, timelines, and safeguards 
for variation, suspension, or revocation under this section. 
 
 
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Chapter-4 
PRUDENTIAL REQUIREMENTS, SAFEGUARDING AND CUSTODY 
24. Segregation of customer assets. —(1) A Licensee shall, at all times, hold Customer Assets 
in segregated accounts separate from its own assets, in the manner prescribed by Regulations. 
(2) Notwithstanding anything to the contrary contained in any other law for the time being in 
force, Customer Assets held by a Licensee shall not form part of the Licensee’s estate in the event of its 
insolvency or liquidation. 
(3) Licensee owes a fiduciary duty to its customers and shall at all times act honestly, fairly, and 
in the best interests of its customers when dealing with Customer Assets. 
(4) A Licensee sha ll not rehypothecate, lend, pledge, or otherwise encumber Customer Assets, 
whether Virtual Assets or fiat balances, without the customer’s explicit, informed, and revocable written 
consent. 
25. Minimum financial resource requirements. —(1) A Licensee shall,  at all times, maintain 
such minimum paid-up capital, liquid assets and financial resources not less than such amounts as may 
be prescribed. 
(2) The Authority may, having regard to the category, size, complexity, or risk profile of a 
Licensee, prescribe higher financial-resource requirements. 
(3) The Authority may, by Regulations, prescribe additional liquidity, margin, risk-based capital 
or reserve requirements having regard to the risks posed by the Licensee’s activities. 
(4) The Authority may, in the manner prescribed by Regulations, grant conditional or risk-based 
exemptions from requirements under this section for limited-scope or low-risk Licensees. 
26. Custody standards and key -management controls. —(1) A Licensee providing custody 
services for Virtual Assets shall: 
(a)  ensure the secure custody and protection of Virtual Assets against unauthorized 
access, loss, or misuse; and 
(b)  maintain operational resilience, including robust disaster -recovery and business-
continuity arrangements. 
(2) The Authority shall prescribe detailed technical standards, operational requirements, and audit 
procedures to ensure that Licensees meet the obligations under this clause, including but not limited to, 
standards for key management, custody mechanisms, and verification of assurance processes. 
27. Proof-of-reserves and audit obligations.—(1) A Licensee shall furnish to the Authority, at 
such intervals as may be Prescribed by Regulations, cryptographic proof -of-reserves reconciled against 
its liabilities to customers. 
 
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(2) A Licensee shall cause its operations to be audited annually by a firm of Chartered 
Accountants approved by the Division concerned. Such audit shall include a verification of the 
segregation of Customer Assets as required under section 24. 
28. Reserve cus todians.—A custodian of reserve assets shall comply with such requirements, 
oversight and inspection standards as may be prescribed by Regulations. 
29. Customer safeguard or compensation mechanism. —The Authority may, establish a 
customer-compensation or safeguard mechanism for losses arising from custodial failure, in such manner 
as may be prescribed by Regulations. 
Chapter-5 
FIAT-REFERENCED AND ASSET-REFERENCED TOKENS 
30. I nitial Virtual Asset Offerings. — (1) Only legal entities, as registered in Pakista n and 
meeting the eligibility criteria prescribed by Regulations shall be permitted to conduct an Initial Virtual 
Asset Offering. 
(2) The Authority may prescribe, by Regulations, the conditions, disclosure requirements, 
approval processes and ongoing obligations applicable to Initial Virtual Asset Offerings. 
31. Issuance Requirements for Fiat-Referenced Tokens.—(1) Any Issuer intending to issue a 
Fiat-Referenced Token in Pakistan shall comply with following requirements: 
(a)  Hundred percent reserve backing , with High -Quality Liquid Assets (HQLA) or 
other assets as prescribed for fiat referenced token, held as a segregated reserve; 
(b)  mechanisms for redemption at par value without undue delay; 
(c)  audited reserve disclosures as prescribed by the Authority; 
(d)  robust AML, CFT, CPF and sanctions compliance programs; 
(e)  prioritized holder protections in insolvency; and 
(f)  any other requirement prescribed by the Authority. 
(2) The Authority may prescribe differentiated requirements based on the size, scope, complexity, 
or risk profile of the issuer, including but not limited to, expedited approval, stress testing, ongoing 
supervision, and consultation with the State Bank of Pakistan on reserve arrangements. 
32. Issuance Requirements for Asset-Referenced Tokens.—(1) Any Issuer intending to issue 
Asset-Referenced Token in Pakistan shall comply with following requirements: 
(a)  a reserve of the underlying assets, as prescribed, for Assets-referenced token held 
in custody in accordance with Regulations; 
(b)  audited reserve disclosures as prescribed by the Authority;  
(c)  robust AML, CFT, CPF and sanctions compliance programs; 
 
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(d)  prioritized holder protections in insolvency; and 
(e)  any other requirement prescribed by the Authority. 
(2) An Asset-Referenced Token shall at all times be fully backed by the underlying assets and 
may reference tangible or intangible assets, including but not limited to commodities, real estate, real -
world assets, securities, financial assets, or a combination of official currencies, but shall not be backed 
or derive its value from other Virtual Assets. 
(3) The Authority may prescribe differentiated requirements based on the size, scope, complexity, 
or risk profile of the Issuer, including, but not limited to, expedited approval, s tress testing, ongoing 
supervision, and consultation with the State Bank of Pakistan on reserve arrangements. The Authority 
may prescribe eligible categories of underlying assets and may restrict or prohibit types of assets for the 
issuance of Asset-Referenced Token. 
33. Significant issuers. —(1) An Issuer shall be deemed a Significant Issuer if it meets the 
thresholds and criteria prescribed by Regulations, having regard to size, scal e, systemic importance, 
market impact, number of holders, and cross-border activity. 
(2) Significant Issuers shall be registered with the Authority and shall comply with enhanced 
requirements, including reporting, disclosure, governance, and risk management, as prescribed in 
Regulations. 
Chapter-6 
CYBERSECURITY, SANDBOX AND INNOVATION 
34. Cybersecurity and operational resilience.—Licensees shall comply with cybersecurity and 
operational-resilience requirements prescribed by the Authority or under any other applicable laws, 
including, but not limited to, technical standards, security controls, and reporting mechanisms. 
35. Regulatory sandbox. —(1) The Authority may establish a regulatory sandbox to facilitate 
controlled testing of innovative Virtual Asset s products or services, in the manner prescribed by 
Regulations. 
(2) Eligibility, application procedures, supervisory arrangements, risk limits, duration and exit 
requirements shall be prescribed by Regulations. 
(3) The Authority may issue guidance, no -objection statements or no-action communications in 
accordance with Regulations. 
36. Oversight of blockchain technology adoption.—(1) The Authority shall issue Regulations, 
standards, directives, and guidelines on the adoption, deployment, and use of blockchain or distributed-
ledger technology. 
(2) The Authority shall consult with rele vant regulators and ministries to ensure harmonization 
of blockchain adoption across Pakistan. 
 
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37. Regulation of Virtual Asset Mining Activities. —(1) The Authority may, in consultation 
with relevant government entities, issue Regulations, standards, and guidelines for mining activities. 
(2) Pure mining, by itself, does not constitute a Virtual Asset Service requiring license  under 
section 18 and Schedule I . Mining operations i nvolving customer assets or funds, however, shall be 
treated as Virtual Asset Services and require licensing. 
(3) The Authority may establish a registration or declaration framework for mining operators 
exceeding thresholds of scale, energy use, or hash rate, as set by Regulations. 
38. Establishment of Strategic Digital Wallet Company. —(1) The Federal Government may 
establish or designate, under the Companies Act, 2017 [XIX of 2017), a wholly owned company to be 
known as the Strategic Digital Wallet Company (SDWC) to perform custody and administration 
services, and to design, develop, operate and secure wallet infrastructure that enables the Government of 
Pakistan or other designated public bodies or institutions to manage, transfer and record Virtual Asset s 
in furtherance of the Company’s strategic reserve objectives. 
(2) The Company sha ll operate exclusively on behalf of the Government of Pakistan and 
designated public bodies and shall not provide services to the private persons. 
39. Data localization framework.— (1) A Licensee may store or process data outside Pakistan, 
subject to compliance with applicable laws relating to data protection, cybersecurity, and cross -border 
data transfers, and subject to such safeguards as shall be prescribed by Regulations. 
(2) Nothing in this section shall prevent the Authority from requiring immediate l ocalization or 
restricted cross-border transfer of specific datasets where necessary in the interest of national security, 
financial stability, consumer protection, or enforcement effectiveness. 
40. Data segregation and protection of sensitive information. —(1) Every Licensee shall 
implement appropriate technical, organizational, and governance measures to ensure the segregation of 
sensitive information from other operational data, in such manner as may be prescribed by Regulations. 
(2) For the purposes of this section, “sensitive information” shall include, but not be limited to- 
(a)  customer identification and due-diligence; 
(b)  transaction-level data capable of identifying a customer; 
(c)  private keys, cryptographic credentials, or wallet authentication data; 
(d)  proprietary trading data and risk-management systems; and  
(e)  any other category of information designated as sensitive by the Authority. 
(3) A Licensee shall ensure that— 
(a)  sensitive information is logically and t echnically segregated from non -sensitive 
data; 
(b)  access to sensitive information is strictly controlled on a need-to-know basis; 
 
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(c)  encryption, tokenization, and secure key-management protocols are implemented 
in accordance with internationally recognised standards; and 
(d)  appropriate audit trails and monitoring mechanisms are maintained. 
(4) The Authority may prescribe, by Regulatio ns, minimum technical standards,  cybersecurity 
controls, storage architectures, encryption requirements, and data-governance frameworks to give effect 
to this section. 
Chapter-7 
MARKET CONDUCT, CONSUMER PROTECTION 
41. Duty of integrity and fair dealing. —(1) A Licensee shall conduct its business honestly, 
fairly and professionally and in accordance with the best interests of its customers and in a manner that 
upholds the integrity of the market. 
(2) The Authority may prescribe, by Regulations, detailed requirements relating to market 
conduct, including standards of fair dealing, professional behaviour, and customer treatment. 
42. Obligations of issuers of Virtual Assets. —(1) An Issuer offering a Virtual Asset to the 
public shall publish a whitepaper in such form and manner as may be prescribed by Regulations. 
(2) Issuers shall make ongoing disclosures of material information including reserve attestations 
in the manner and frequency prescribed by Regulations. 
(3) The Authority may exempt categories of Issuers or offerings from requirements under this 
section, subject to appropriate safeguards. 
(4) The Authority shall prescribe, by Regulations, mandatory risk disclosures, periodic reporting 
requirements and disclosure templates applicable to Issuers and Licensees. 
43. Marketing and conduct restrictions. —(1) No person shall advertise or market a Virtual 
Asset unless the Issuer holds a valid license or registration under this Act. 
(2) All marketing materials shall contain risk disclosures and shall comply with such conditions, 
standards and limitations, in such form and manner, as may be prescribed by the Authority. 
44. Conflic t-of-interest management. —A Licensee shall identify, manage, and disclose 
conflicts of interest and shall not place its own interests above those of its customers, in accordance with 
detailed requirements on policies, disclosure, and management as may be prescribed by the Authority by 
Regulations. 
45. Complaint-handling and dispute resolution. —(1) Licensees shall establish and maintain 
internal complaint-handling procedures in accordance with the requirements prescribed by Regulations. 
(2) Notwithstanding anything contained in any other law for the time being in force, the Authority 
may establish or recognize an independent dispute -resolution scheme for claims below a prescribed 
monetary threshold. 
 
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Chapter-8 
ANTI-MONEY LAUNDERING, COUNTERING OF TERRORISM FINANCING AND 
COUNTERING OF PROLIFERATION FINANCING 
46. Application of A nti-Money Laundering Act, 2010. —(1) For the purposes of the Anti -
Money Laundering Act, 2010 (VII of 2010), Virtual Asset Service Providers licensed under this Act 
shall be deemed to be financial institutions, and shall comply with all obligations thereunder. 
(2) Without prejudice to sub-section (1), every Virtual Asset Service Provider and Issuer shall- 
(a)  report suspicious transactions to the Financial Monitoring Unit (FMU) in 
accordance with Anti-Money Laundering Act, 2010 (VII of 2010) and any rules, 
regulations or guidelines issued thereunder; 
(b)  maintain records of customer due diligence, transactions and other relevant 
information for the period prescribed under Anti -Money Laundering Act, 2010 
(VII of 2010); and 
(c)  establish and maintain i nternal controls and compliance programmes to prevent 
money laundering and terrorist financing, including the appointment of an AML, 
CFT or CPF compliance officer. 
(3) The Authority shall, through AML, CFT or CPF Regulations, align its supervisory framework 
with the standards of the Financial Action Task Force (FATF) and may issue additional guidance, 
consistent with FMLI’s mandate, to address risks specific to Virtual Assets. 
47. Travel rule and record-keeping obligations. (1) A Licensee shall obtain, hold and transmit 
originator and beneficiary information in any transfer of Virtual Assets meeting or exceeding the 
threshold prescribed by the Authority, in a manner consistent with Recommendations of Financial Action 
Task Force, as updated from time to time. 
(2) Such obligations shall be implemented in compliance with applicable data protection, data 
governance, and cybersecurity laws, ensuring the confidentiality, integrity, and sec urity of the 
information. 
(3) The Authority may prescribe detailed procedures, standards, and formats for record-keeping, 
reporting, and transmission of information through Regulations. 
(4) A Licensee shall maintain records of transactions, customer due -diligence data and risk 
assessments for a period prescribed by Regulations, which shall not be less than the period required 
under the Anti-Money Laundering Act, 2010 (VII of 2010). 
48. Real -time data access and reporting. —(1) Licensees shall establish secur e reporting 
channels, and where required secure automated interfaces, enabling the Authority and such other 
agencies as notified to access prescribed data for supervisory and enforcement purposes. 
(2) The Authority shall prescribe, by Regulations, the technical standards, security requirements 
and data specifications for the reporting and interfaces referred to in subsection (1). 
 
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49. Data Privacy Obligations for Licensed entities.- Each licensee shall implement strict limits 
on the collection, use, and sharing of customer data, requiring explicit, informed, and revocable consent 
for any non-essential data processing. 
Chapter-9 
Prohibitions 
50. Prohibition of unlicensed Virtual Asset services.—(1) No Person shall, by way of business, 
engage in, or represent themselves as engaging in, any Virtual Asset Services in or from Pakistan, unless 
that Person:- 
(a)  is a company incorporated under the Companies Act, 2017 or any other law for 
the time being in force in Pakistan governing the incorporation of companies; and 
(b)  holds a valid license granted by the Authority under this Act. 
51. Prohibition on Initial Virtual Asset Offerings. —No Person shall conduct or purport to 
conduct an Initial Virtual Asset Offering, in or from Pakistan, except in accordance with this Act and the 
Rules or Regulations made thereunder. 
52. Prohibition of market manipulation and insider trading. —(1) No person shall engage in 
market manipulation or Market abuse in relation to virtual assets. 
(2) No person shall: 
(a)  use inside information to trade virtual assets for themselves or others; 
(b)  recommend or induce trading based on inside information; or 
(c)  unlawfully disclose inside information. 
(3) The Authority shall issue guidelines and regulations specifying the type of manipulative 
behavior. 
53. Prohibition on Algorithmic tokens.—No Person shall issue, offer, or market a Virtual Asset 
whose primary mechanism for maintaining value is algorithmic and not fully or adequately 
collateralized, unless specifically permitted by Regulations and  subject to the safeguards prescribed 
therein. 
Chapter-10 
ENFORCEMENT, OFFENCES AND PENALTIES 
54. Criminal offences. —(1) Whoever, willfully, provides an unlicensed Virtual Asset Se rvice 
shall be punishable with imprisonment for a term up to five years, or with fine up to fifty million Rupees, 
or with both. 
(2) Whoever conducts an Initial Virtual Asset s Offering in contravention of this Act, Rules and 
Regulations shall be punishable with imprisonment for a term up to three years, or with fine up to twenty-
five million Rupees or with both. 
 
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(3) Whoever, wilfully, contravenes section 52 shall be punishable: 
(a)  in the case of natural person, with imprisonment for a term up to three years or 
with fine up to twenty-five million Rupees or with both. 
(b)  in the ca se of a legal person, with fine or three times the amount of any profit 
gained or loss avoided as a result of the contravention. If the amount of profit 
gained or loss avoided cannot be determined, a fine not exceeding 15% of the total 
annual turnover of the body corporate in the preceding financial year. 
(4) Whoever, knowingly, makes any false or misleading statement in any application, return or 
document submitted to the Authority shall be punishable with imprisonment for a term up to three years, 
or with fine up to twenty million Pakistani Rupees, or with both. 
(5) Whoever, obstructs an officer of the Authority in the exercise of powers under this Act shall 
be punishable with imprisonment for a term up to two years, or with fine up to ten million Pakistan i 
Rupees, or with both. 
(6) Whoever, willfully, fails to comply with any order or decision of the Authority shall be 
punishable with imprisonment up to one year, or with fine up to twenty -five million Pakistani Rupees 
and the Authority may also impose administrative penalties prescribed in this Act. 
(7) All offences punishable under this Act shall be investigated, tried, and punished in accordance 
with the provisions of the Code of Criminal Procedure, 1898 (Act V of 1898) and the Qanun-e-Shahadat 
Order, 1984 (Order X of 1984), unless otherwise provided in this Act. 
(8) The Federal Government may, by notification in the Official Gazette, designate one or more 
Special Courts to exercise jurisdiction over offences committed under this Act. 
55. Liability of offi cers of bodies corporate. —Where an offence under this Act i s committed 
by a body corporate with the consent, connivance or neglect of any director, manager, secretary or similar 
officer, such Person shall be deemed to have committed the offence. 
56. Power to Investigate.—Only an authorized officer of the Authority shall have the power to 
investigate offences under this Act. 
57. Powers of Authorized Officer.—(1) For the purpose of investigation of offences under this 
Act, an authorised officer shall obtain a warrant for search and seizure of evidence of an offence from a 
court of competent jurisdiction. 
(2) The powers specified in sub -section (1), the authorized officer shall, for the purposes of 
investigation, inquiry, search, seizure, arrest, attachment, confiscation, and other criminal proceedings 
under this Act, exercise all powers conferred upon an officer incharge of a police station or an 
investigating officer under the Code of Criminal Procedure, 1898 (Act V of 1898), subject to the 
provisions of this Act. 
 
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(3) Any person who, wilfully, refuses to provide information required by the Authorized Officer 
under sub-section (1) shall be punishable with imprisonment for a term up to one year or with fine up to 
one million rupees or with both. 
(4) No Court sh all take cognizance of any offence under this Act except on a report in writing 
submitted by an authorized officer of the Authority. 
58. Prosecution of offences.—(1) All prosecutions under this Act shall be conducted by a special 
public prosecutor appointe d by the Federal Government. The special public prosecutor, or advocates 
appointed by the Division concerned, may institute or defend cases, appeals, petitions, applications, and 
all other matters before any court, including the High Court and Supreme Court, arising from proceedings 
under this Act. 
(2) The personal attendance of any officer authorized by the Authority to file a complaint shall 
not be required during trial in the presence of the special public prosecutor referred to in sub-section (1). 
(3) The court shall, in a manner not inconsistent with this Act, follow the procedure provided 
under Chapter XXII-A of the Code of Criminal Procedure, 1898 (Act V of 1898), and all prosecutions 
shall be disposed of and judgments pronounced as expeditiously as possible. 
(4) Hearings shall not be adjourned except for sufficient cause to be recorded, and for no more 
than fourteen days at a time. The court may impose such costs as it deems fit. 
59. Administrative sanctions. —(1) Where the Authority is satisfied that a Person has 
contravened any provision of this Act, or any Rules, Regulations, directions, circulars, or other regulatory 
requirements made thereunder, it may, impose one or more of the following sanctions 
(a)  issue a written reprimand or public censure; 
(b)  issue a directive requiring the Person to cease or remedy the contravention; 
(c)  impose a financial penalty up to the maximum amount prescribed by the Rules; 
(d)  suspend or revoke any license issued under this Act; or 
(e)  disqualify any Person from  holding any office  or position of responsibility i n a 
Licensee. 
(2) Where the Authority is satisfied that an Issuer has contravened this Act or any Regulations 
made thereunder, it may impose sanctions under sub -section (1), with such modifications as are 
appropriate, upon Issuers. 
(3) Without prejudice to sub-sections (1) and (2), where a Virtual Asset Service Provider or Issuer 
contravenes any other law applicable in Pakistan, the Authority may, in accordance with Regulations, 
impose administrative sanctions as it deems appropriate. 
(4) The Authority may impose a fine up to twenty -five million rupees for any contravention of 
the provisions of this Act. 
 
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(5) The court may order restitution, disgorgement of profits or such other relief as it deems 
appropriate. 
60. Emergency intervention powers.—In the event of a systemic threat, market manipulation, 
fraud, or cybersecurity breach, or other serious risk to customers or market Integrity, the Authority may 
issue an order temporarily suspending specified Virtual A sset Services or freezing related assets for a 
period not exceeding thirty days. 
61. Power to prevent access to unlicensed virtual asset services. —(1) The Authority may 
remove, block, or direct the removal or blocking of any online material (e.  g., websites, apps, ads, 
payment links) if, on reasonable grounds, it promotes, operates, or relates to an unlicensed Virtual Asset 
Service or contravenes this Act, its Rules, or Regulations. 
(2) Such directions may be issued to telecommunication authorities, Virtual  Asset Service 
Providers, intermediaries, hosting providers, app stores, search engines, advertising networks, registrars, 
payment providers, or any person facilitating such material. 
(3) All orders or directions shall be in writing, stating reasons and st atutory basis, and 
communicated to the affected person. 
(4) The Authority may require preservation of copies, logs, or transactional data for evidentiary 
purposes. 
(5) A person aggrieved by an order may submit a representation within ten days; the Authorit y 
shall respond in writing within fifteen days. 
Chapter-11 
APPEALS 
62. Establishment of the virtual assets appellate tribunal. —(1) A Virtual Assets Appellate 
Tribunal shall be established and no court shall take cognizance of a legal dispute under this Act  or the 
Rules or Regulations made thereunder to which the jurisdiction of the Virtual Assets Appellate Tribunal 
extends. 
(2) The Virtual Assets Appellate Tribunal shall consist of a presiding officer, who shall be a 
person who is a retired Judge of a High Court, or an advocate having not less than ten years' practice and 
experience in the relevant field, and two members, one being a technical expert and the other being a 
financial expert, who shall be Persons of ability, Integrity, and have special knowledge and professional 
experience of not less than ten years in the fields of law, technology, finance, or economics. 
(3) The presiding officer and members of the Virtual Assets Appellate Tribunal shall be appointed 
by the Federal Government, i n the manner Pre scribed, and hol d office for a period of three years and 
shall be eligible for re-appointment for a similar term or terms and shall cease to hold office on attaining 
the age of sixty years or the expiry of the term, whichever is earlier. 
(4) The terms, con ditions, and appointment of the Virtual Assets Appellate Tribunal presiding 
officer and other members shall be in the manner Prescribed by the Federal Government. 
 
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63. Jurisdiction.—Any Virtual Asset Service Provider, Licensee, or any other Person aggrieved 
by an order of the Authority may prefer an appeal before the Virtual Assets Appellate Tribunal within 
thirty days of the date on which the order was communicated, in accordance with the Prescribed Rules. 
64. Appeal.—(1) An appeal to the Virtual Assets App ellate Tribunal shall be filed within thirty 
days from the date of such order in such form, contain such particulars, and be accompanied by such 
documents and fees as may be prescribed under this Act. 
(2) The Virtual Assets Appellate Tribunal shall decide an appeal expeditiously but not later than 
three months of its presentation to the Tribunal. 
(3) The Virtual Assets Appellate Tribunal shall, for the purpose of deciding an appeal, be deemed 
to be a civil court and shall have the same powers as are vested in such court under the Code of Civil 
Procedure, 1908 (Act V of 1908), including the powers of— 
(a)  enforcing the attendance of any Person and examining him on oath; 
(b)  compelling the production of documents; and 
(c)  issuing commissions for the examination of witnesses and documents. 
(4) It shall be sufficient for the Virtual Assets Appellate Tribunal to establish, or to be satisfied 
as to any matter on the standard of proof applicable to civil proceedings in a summary manner in a court 
of law. 
(5) The Virtual Assets Appellate Tribunal's determinations or decisions under this Act shall be 
deemed to be the decrees of a civil court under the Code of Civil Procedure, 1908 (Act V of 1908). 
65. Appeal to Supreme Court. —Any Person aggrieved by an order of the Virtual Assets 
Appellate Tribunal may file an appeal to the Supreme Court of Pakistan within thirty days from the date 
of such order and in such manner as may be prescribed. 
Chapter-12 
MISCELLANEOUS 
66. Tax Compliance. —Every Virtual Asset Service Pr ovider licensed under this Act shall 
comply with the obligations imposed under the Income Tax Act, 2001 and any Rules or Regulations 
issued by the Federal Board of Revenue. 
67. Power to make Rules.—The Federal Government may by notification in the official Gazette, 
make Rules, as deemed necessary for the implementation of and to carry out the purposes of this Act. 
68. Powers to make regulations. —The Authority may make Regulations in the consultation 
with Division concerned as deemed necessary for the implem entation of and for carrying out the 
purposes of this Act. 
69. Officers to be Public Servants. —The Chairperson, Managing Director, members, staff, 
experts; consultants, advisers, other officers and employees of the Authority shall be deemed to be public 
servants within the meaning of section 21 of the Pakistan Penal Code; 1860 (XLV of 1860). 
 
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70. Transitional provisions. —(1) Any Person providing Virtual Asset Services Immediately 
before the commencement of this Act shall, within six months of such commenceme nt, apply to the 
Authority for a license under this Act or shall cease to provide such services. 
(2) After the commencement of this Act, within six months, a Person who has submitted a 
complete application as per sub-section (1) may continue to provide existing Virtual Asset Services: 
Provided that such Person fully complies with any interim directives issued by the Authority and 
continues to adhere to the core obligations of this Act, particularly regarding customer asset protection 
under AML, CFT and CPF. 
71. Power of the Federal Government to issue policy directives. —The Federal Government 
may, by notification in the official Gazette, give policy directives to the Authority to align its actions 
with national policies, priorities and interests consistent w ith the objectives and framework established 
under this Act. Such policy directives shall not impede the Authority's operational autonomy. 
72. Annual and special reports of the Authority. — (1) The Authority shall prepare an annual 
report at the end of the financial year and may at any time prepare special reports on any matter which 
in its opinion is of particular urgency or importance. 
(2) The Division concerned shall cause the annual report and the special reports to be laid before 
the Majlis-e-Shoora (Parliament) within ninety days. 
(3) The report shall be placed on the website of the Authority immediately after its lying before 
the Majlis-e-Shoora (Parliament) for information of general public. 
73. Removal of difficulties. —If a procedural or operational difficulty arises in giving effect to 
any of the provisions of this Act, the Federal Government may, within six months of the commencement 
of this Act, make such order not inconsistent with the provisions of this Act, as may appear to it to be 
necessary or expedient for removing such difficulty. 
74. Savings.—Notwithstanding the lapse of the Virtual Assets Ordinance, 2025 (VII of 2025), 
anything done, action taken, appointment made, notification or order Issued, or right, privilege, 
obligation or liability accrued under the said Ordinance shall be deemed to have been validly done, taken, 
made, issued or accrued under the corresponding provisions of this Act. 
 
 
 
 
 
 
 
 
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SCHEDULE-I 
(See section 18) 
CATEGORIES OF VIRTUAL ASSET SERVICES 
The list below shall constitute the types of Virtual Asset Services and their description. 
Sr. No.  Service Category  Description 
(1) (2) (3) 
1.            Advisory Services means the provision of 
personalized recommendations, on 
professional basis, to a customer, 
either upon request or at the 
initiative of Virtual Asset Service 
Providers, relating to one or more 
actions or transactions involving 
Virtual Assets.  
 
The term “ personalized” refers to 
recommendations that are 
addressed to a specific customer 
and take into account (or are 
presented as taking into account) 
that customer’s individual 
circumstances, objectives, risk 
profile or financial situation. 
General market info rmation, 
research reports or non - 
individualised suggestions do not 
constitute personalised 
recommendations.  
 
 
 
 
 
 
 
 
 
 
 
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2.               Broker-Dealer Services     means any of the following: 
 
(a) arranging or facilitating 
orders for the purchase and 
sale of Virtual Assets 
between two parties; 
 
(b) soliciting or accepting 
orders and receiving 
consideration in flat 
currency or Virtual Assets; 
 
(c) trading Virual Assets on 
the Virtual Asset Service 
Provider’s own account; 
 
Exemption: A person that deals 
solely on its own account, does not 
execute orders on behalf of 
customers, and does not hold or 
control Customer Assets is not 
regarded as carrying on ‘broker -
dealer services’ for the purposes of 
this act 
 
(d) market-making using 
Customer Assets; or 
 
(e) providing placement or 
distribution services for 
issuers acting as 
intermediaries.   
3. Custody and Administration Services means the safekeeping or 
administration, on behalf of 
customers and pursuant to their 
instructions, of: 
 
(a) Virtual Assets; or 
 
(b) private cryptographic keys   or  
other means of access that allow  
the customer to transfer or dispose  
of Virtual Assets independently 
but excludes the mere provision of 
software, hardware or 
infrastructure that enables  a 
customer to reta in exclusive 
control over their own private 
keys. 
 
 
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4.                 Exchange Services means any of the following: 
 
(a) exchanging Virtual Assets 
for fiat currency; 
 
(b) exchanging one or more 
types of Virtual Assets; 
 
(c) matching orders between 
buyers and sellers and 
executing conversions as 
described in (a) and (b); or 
 
(d) maintaining an order book 
for the above purposes. 
 
5. Lending and Borrowing Services means the facilitation, 
arrangement, intermediation or 
direct provision (as principal) of 
lending or borrowing arrangements 
involving Virtual Assets, where 
one or more lenders transfer, lend 
or make available Virtual Assets 
(or rights thereto) to one or more 
borrowers, subject to a contractual 
obligation for the borrower to 
return equivalent Vi rtual Assets 
(together with any agreed interest, 
fees or rewards) at a specified time 
or upon demand. 
 
 
6. Virtual Assets Derivatives Services means the offering, facilitation, 
execution, clearing, trading or 
arranging of transactions in 
derivatives (incl uding futures, 
options, swaps, contracts for 
difference or other similar  
Instruments) that have a Virtual 
Asset (or a basket or index of 
Virtual Assets) as their underlying 
reference asset. 
 
7. Virtual Asset Management and  
                 Investment  
                 Services 
means acting in a fiduciary or 
agency capacity for the purpose of 
managing or administering another 
Person’s Virtual Assets, including: 
 
 
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(a) portfolio or discretionary 
investment management involving 
Virtual Assets; and 
 
(b) respo nsibility for staking on 
behalf of customers to earn 
validator or network rewards, 
provided that such staking is 
performed on a discretionary basis 
or forms part of a broader 
investment management mandate. 
 
8. Virtual Asset Transfer and Settlement  
           Services 
includes transfer, transmission, or 
settlement of Virtual Assets 
between parties, or from one 
wallet, address, or location to 
another, on behalf of customers 
excluding exchange execution. 
 
9.            Virtual Assets Issuance Services Creation, issuance, initial offering, 
administration, and ongoing 
management of Virtual Assets, 
including supply control, reserve 
management (if any), redemption, 
governance, and required 
disclosures. 
 
10. Mining-related Virtual Assets Services Includes a ctivities where mining 
operations provide services to third 
parties involving customer virtual 
assets or funds. Pure mining for 
own account is excluded. 
Licensing and regulatory 
obligations apply only  if the 
service involves customer assets or 
funds, as pe r the Authority’s 
Regulations.  
 
 
_______________________ 
 
 
 
RGN Date: 06-03-2026