Pakistan has taken a formal step into the world of cryptocurrency with the segment of the Regulation of Virtual Assets Act, 2026. The law is being highlighted as a way to modernize the economy and make overseas remittances cheaper and faster. The legislation, recently published on the website of Senate of Pakistan, replaces last year’s temporary ordinance on virtual assets. It comes at a time when Pakistan is under pressure to boost dollar inflows and stabilize its financial system.
Crypto Regulation
Officials say the new framework will help regulate crypto exchanges, attract investment, and reduce reliance on informal money channels. The policy conversation has also included discussions around stablecoins, particularly dollar-backed digital currencies, which are being presented as tools to support remittances and financial inclusion.
The State Bank of Pakistan has long maintained a cautious stance on crypto, citing risks to foreign reserves and financial stability. The new law attempts to bridge that caution with controlled adoption.
Remittances Policy
According to the government, one major purpose of the new law is to make cross-border payments cheaper and faster, particularly for overseas Pakistanis sending money home. Digital assets, especially US dollar, linked stablecoins, are being presented as tools that could reduce costs and reliance on informal transfer networks. Officials argue that formal regulation will help bring crypto activity into the documented economy and strengthen oversight rather than weaken it.
However, the financial analysts, point to several sections of the law that grant wide discretionary powers to regulators. These include the authority to license operators, approve special projects and designate specific zones for virtual asset activity.
Critics say such flexibility, without clear public criteria, risks creating unequal access to the financial system. They caution that laws built on broad exemptions often depend more on who is applying than on what is being applied for.
Modern Crypto and Hundi System
Some analysts note that Pakistan has a long history of informal money transfer networks, often referred to as Hundi, which have been used to move funds across borders outside official banking channels. Digital assets, stablecoins, and crypto exchanges could potentially serve similar roles, officially legal for some, but still raising questions about transparency and oversight.
By framing crypto as a tool for “faster remittances,” regulators hope to encourage formal use, but observers caution that the insights from Hundi networks especially regarding accountability should inform how the new system is monitored.
Who Faces the Heavier Burden
Market observers also note that the regulatory burden is not the same for everyone. Ordinary traders continue to face taxes, blocked banking channels and compliance checks. At the same time, institutional players with licenses may enjoy smoother access within the legal framework.
Globally active exchanges such as Binance and HTX already serve millions of users worldwide, including Pakistanis. Regulators now face the challenge of supervising these platforms in a way that is both effective and even-handed.
Rules Under Scrutiny
Government officials maintain that safeguards are in place and that the law will improve transparency in a largely unregulated space. Economists counter that without independent audits, parliamentary scrutiny and clear enforcement standards, regulation alone may not be enough. For a country that regularly faces balance-of-payments stress, even limited gaps in financial oversight can carry long-term consequences.
