What Is PVARA? Pakistan's Virtual Assets Regulator

Every regulated market has a body that decides who trades in it. In Pakistan’s virtual asset market, that body is PVARA.

It is new, it is statutory, and it holds a wider set of powers than most people assume. PVARA does not merely issue licences. It sets prudential standards, inspects licensees, blocks websites, imposes fines, investigates offences and prosecutes them through a special court.

This article sets out what PVARA is as a matter of law: its corporate status, who sits on it, what it is required to do, and what it is empowered to do.

What is PVARA?

PVARA is the Pakistan Virtual Assets Regulatory Authority, established under section 6 of the Virtual Assets Act, 2026. It is a body corporate with perpetual succession and a common seal, it may sue and be sued in its own name, and section 6(3) provides that it shall be autonomous in the performance of its functions and the exercise of its powers.

Section 3(1)(ii) of the Act defines “Authority” or “PVARA” as the Pakistan Virtual Assets Regulatory Authority established under the Act. The two terms are used interchangeably throughout the statute.

Under section 6(4), PVARA’s headquarters is at Islamabad, and it may set up as many offices across Pakistan as required.

Who sits on the Authority?

Section 7(1) provides for an eight-part composition: a Chairperson appointed by the Federal Government, five ex-officio members drawn from other institutions, the Chairperson of the Pakistan Digital Authority, and two independent directors appointed by the Federal Government.

The full composition is:

Position	Basis
Chairperson	Appointed by the Federal Government
Secretary, Ministry of Finance	Ex officio
Secretary, Ministry of Law and Justice	Ex officio
Governor, State Bank of Pakistan	Ex officio
Chairperson, Securities and Exchange Commission of Pakistan	Ex officio
Chairman, National AML-CFT Authority	Ex officio
Chairperson, Pakistan Digital Authority	Ex officio
Two independent directors	Appointed by the Federal Government, in the manner prescribed

The independent directors must possess “proven expertise and a strong track record” relevant to virtual asset markets, digital technology or digital finance. Under section 7(2), non-ex-officio members hold office for three years and are eligible for one further term of three years.

This composition is worth reading carefully. It places the heads of the State Bank of Pakistan and the Securities and Exchange Commission of Pakistan inside the regulator itself. In practice, that structure builds inter-regulator coordination into PVARA’s own decision-making rather than leaving it to correspondence between institutions.

How does the Authority make decisions?

Section 8 sets the procedure. PVARA must meet at least twice a year, and may meet at any time on the requisition of the Chairperson or of at least fifty percent of the members. The quorum is fifty percent of total membership, with the mandatory presence of specified members. Decisions are taken by majority of members present.

Section 8(2) requires that quorum include members (a), (b) and (d) as listed in section 7 — that is, the Chairperson, the Secretary of the Ministry of Finance, and the Governor of the State Bank of Pakistan. No meeting is quorate without all three.

Meetings are presided over by the Chairperson or, in the Chairperson’s absence, by a member the Chairperson nominates.

Two individual offices carry day-to-day authority:

• The Chairperson, appointed by the Federal Government under section 11, must have demonstrable expertise in digital finance or technology and a minimum of three years’ relevant professional experience. The Chairperson provides overall guidance, direction and oversight, and may be removed before term only for gross misconduct or incapacity, following a show cause notice and an opportunity to be heard.
• The Managing Director, appointed by the Authority under section 12 for a three-year term, extendable for a further maximum of two terms of three years. The Managing Director acts as Secretary of the Authority for its proceedings but has no voting rights unless specifically authorised.

Section 10 allows the Authority to delegate any of its powers and functions to the Managing Director, subject to such terms, conditions and limitations as it deems appropriate.

What is PVARA required to do?

Section 9(1) sets out nine statutory functions. These are duties, not discretions — the section says the Authority “shall” perform them.

The nine functions are:

• Licence, regulate and supervise virtual asset service providers and issuers
• Protect customers, investors and market integrity through safeguards, conduct of business requirements, prudential and operational-resilience standards, and measures against illicit use
• Attract investment and encourage virtual asset companies to base their business in Pakistan
• Promote responsible innovation, digital financial inclusion and compliant market development
• Promote, develop, govern and regulate the adoption and scalable use of blockchain and distributed ledger technology across Pakistan
• Assess, determine and classify any virtual asset, service, activity, offering, issuer or service provider by substance rather than label
• Coordinate with the Financial Monitoring Unit, the National AML and CFT Authority and law enforcement on money laundering and terrorist financing
• Advise the Federal Government on regulatory, supervisory, technical or emerging-risk matters
• Do all such acts as may be necessary or incidental to discharging its functions

The third function is unusual for a financial regulator and worth noting: PVARA has a statutory investment-attraction mandate. It is required to encourage virtual asset companies to base themselves in Pakistan, not merely to police those that do.

What powers does PVARA hold?

Section 9(2) confers fourteen powers, expressed “without prejudice to the generality” of the functions in section 9(1). They span rule-making, supervision, enforcement and international cooperation.

“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…”

— Virtual Assets Act, 2026, section 9(2)(a)

The powers most likely to affect a licensee day to day are:

Power	Section	Effect
Make Regulations and directives	9(2)(a), 68	Sets the binding detail the Act defers
Set prudential, conduct, cyber and data standards	9(2)(b)	Establishes the technical baseline
Issue, vary, suspend or revoke licences	9(2)(c)	Controls market access
Prescribe licensing conditions and eligibility	9(2)(d)	Determines who qualifies
Conduct on-site inspections and off-site monitoring	9(2)(e)	Supervisory examination
Require information, documents and data	9(2)(f)	Compels production
Impose administrative sanctions	9(2)(h), 59	Fines, censure, disqualification
Levy fees, charges and penalties	9(2)(j)	Sets the cost of being regulated
Operate regulatory sandboxes	9(2)(k), 35	Controlled testing route
Enter mutual recognition arrangements	9(2)(l)	Cross-border licence recognition

The tenth is worth dwelling on. Section 9(2)(l) allows PVARA to enter cooperation or mutual assistance arrangements with domestic and foreign regulators “including mutual recognition of Regulations and licenses.” That is an enabling power only, and no such arrangement is described in the Act. But it is the statutory hook on which any future passporting arrangement would hang.

How is PVARA funded and held to account?

Section 14 establishes the Pakistan Virtual Asset Regulatory Authority Fund, a lapsable fund vested in and administered by the Authority. It draws on eleven listed sources, including federal funding, grants, NOC and licensing fees, penalties and fines, and charges for services including sandbox participation.

Accountability runs through three channels:

Audit. Under section 15(4), the Authority’s accounts are audited at the end of each financial year by the Auditor General of Pakistan and by a firm of Chartered Accountants nominated by the Auditor General.

Reporting to Parliament. Section 15(7) requires an annual report 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. Section 72(2) requires the Division concerned to lay the annual report and any special reports before the Majlis-e-Shoora (Parliament) within ninety days, and section 72(3) requires publication on PVARA’s website immediately afterwards.

Conduct. Section 16 requires the Chairperson, members, Managing Director, officers and employees to act with integrity, impartiality, confidentiality and good faith, and to avoid conflicts of interest. Section 16(2) requires a prescribed Code of Conduct covering disclosure of interests, conflict management, restrictions on personal trading in virtual assets, confidentiality and post-tenure obligations. Under section 16(3), a violation constitutes misconduct and “shall result in removal from office or service.” Section 69 deems all PVARA personnel to be public servants within the meaning of section 21 of the Pakistan Penal Code, 1860.

Section 71 preserves a federal steer: the Federal Government may issue policy directives to align PVARA’s actions with national policies and priorities, but such directives “shall not impede the Authority’s operational autonomy.” How that proviso operates in practice is not settled by the Act, and it is one of the more consequential open questions in the statute.

Related reading

• PVARA Exchange License: Capital, Rules & Obligations 2026
• PVARA Transfer & Settlement License: Crypto Payments 2026
• The PVARA Licensing Gold Rush: Pakistan’s Crypto Frontier
• PVARA Custody License: Safeguard Customer Crypto 2026
• PVARA Management & Investment License: Crypto Funds 2026

About this analysis

This analysis was prepared by the CoinConnect research desk from the Virtual Assets Act, 2026 as passed by the National Assembly, read as published. Where practice is not yet settled or guidance has not been issued, that is stated in the text above.

Regulatory positions change and specific requirements should be verified against the current position published by the relevant authority before you act on them. This is information and analysis, not legal advice, and it does not create an advisory relationship. Take professional advice on your own circumstances.