Pakistan opens licensing applications for international crypto companies and Virtual Asset Service Providers (VASPs) through its regulatory body, the Pakistan Virtual Asset Regulatory Authority (PVARA), with global compliance standards and stringent criteria. The Pakistan Government said it wants global crypto exchanges and VASPs to apply for licenses and operate legally.

Pakistan Welcomes, But With Strict Criteria

The Government of Pakistan stated it wants global crypto companies to participate in the emerging digital economy of the country. The government established PVARA, the Pakistan Virtual Asset Regulatory Authority, which is in charge of formalizing and regulating virtual assets according to international standards set by the Financial Action Task Force (FATF), IMF, and World Bank.

The Government further stated that they are doing this to support their large crypto user base, which is approximately 40 million users, with annual trading volume estimated to be around $300 billion, considered one of the biggest undeveloped markets. The chairman of PVARA, Bilal Bin Saqib, said that their Expressions of Interest (EoI) is Pakistan’s invitation to the world’s leading VASPs to partner in building a transparent and inclusive digital financial future. He also mentioned that eligibility will only be available to VASPs and crypto companies licensed under recognized international regulations worldwide.

Pakistan has applied strict rules for the exchanges that will be licensed, stating that only exchanges already licensed in strong jurisdictions (i.e., U.S., UK, EU, UAE) can apply. Applicants must prove they follow AML (Anti-Money Laundering), CTF (Counter-Terrorist Financing), and KYC (Know Your Customer) rules. Furthermore, the submissions must include company profiles, licenses, services, security details, and a Pakistan-specific business plan. These rules must be complied with by global exchanges when getting licensed in the country.

Pakistan’s Goal

Pakistan aims to support its local crypto market to have a safe and established platform. Pakistan ranked 3rd in global crypto adoption, according to Cointelegraph. The reason for the licensing of global crypto exchanges and VASPs is to stop illegal finance, protect consumers, and boost innovation in fintech, remittances, and tokenized assets. They also aim to create Shariah-compliant digital finance products through regulatory sandboxes and turn Pakistan into a global crypto hub.

Pakistan’s Big Crypto Future Awaits

Pakistan has been taking careful and supportive steps to emerge as one of the fastest-growing crypto markets, and by doing so, significant progress has already been made. The Pakistan Government has sought this opportunity and invited major crypto companies to serve one of the world’s biggest crypto markets, which currently ranks in the top three. Along with the invitation, Pakistan has also set strict criteria for the exchanges that can accept their invitation, since Pakistan remains cautious as this would be their first crypto regulatory experience. This step may bring ease to consumers and create a local platform for them to buy and sell crypto without much hassle.