Pakistan is not doing crypto halfway. While most emerging markets are still debating whether to regulate digital assets at all, Islamabad is simultaneously licensing exchanges and standing up a specialized unit to police money laundering across the sector.

From warnings to watchdogs

Back in 2018, Pakistan’s regulatory posture toward crypto was firmly in the “this is suspicious” camp, with official warnings discouraging participation in digital asset markets.

That stance has since done a full rotation. In July 2025, the Pakistan Virtual Assets Regulatory Authority, known as PVARA, was established under the Virtual Assets Regulatory Authority Ordinance, explicitly designed to align with Financial Action Task Force requirements. Then in May 2026, Parliament passed the Virtual Assets Act, giving PVARA a full statutory foundation to oversee digital asset exchanges and service providers operating in the country. The new crypto investigation unit sits inside this broader enforcement architecture, tasked with pursuing money laundering cases that touch the digital asset space.

One institutional building block that preceded all of this was the Pakistan Crypto Council, launched in March 2025 to shape blockchain and digital assets policy.

Why enforcement and licensing together

The Federal Investigation Agency has a relevant track record here. The FIA has historically investigated crypto-related scams in Pakistan, including cases involving large exchanges like Binance. That institutional experience provides a foundation of investigative know-how that the new specialized unit can build on.

Money laundering through crypto can take several forms: layering illicit funds through peer-to-peer transactions, using unlicensed exchanges as on-ramps, or exploiting stablecoins to move value across borders with limited documentation. Pakistan has a large informal crypto ecosystem given its historically high crypto adoption rates, making a unit that monitors only licensed exchanges insufficient to address the broader problem.

What this means for the market

For exchanges looking at Pakistan as a growth market, the regulatory picture is both more welcoming and more demanding than it was two years ago. Licensing creates legitimacy and a legal pathway to operate, but the compliance infrastructure needed to satisfy PVARA and FATF-aligned AML requirements is not cheap or simple to build. Smaller exchanges may find the compliance costs prohibitive, while larger, well-capitalized platforms that have already built AML programs for other jurisdictions are better positioned to absorb those costs.

Pakistan’s enforcement capacity—staffing levels, technical expertise, cross-border coordination with agencies in other jurisdictions—will determine whether the investigation unit becomes a credible deterrent or a bureaucratic formality.