In a landmark development for Pakistan’s digital economy, the federal government has announced the formation of a dedicated regulatory body for virtual assets, signaling a shift from restriction to regulation in the country’s approach to digital finance. The new entity, known as the Pakistan Digital Assets Authority (PDAA), will serve as the centralized institution responsible for overseeing blockchain-based financial infrastructure, including cryptocurrencies, decentralised finance (DeFi) platforms, stablecoins, and tokenisation systems.
The announcement, made by the Ministry of Finance, has been welcomed by key industry stakeholders who see it as a crucial step toward formalising the country’s digital asset ecosystem. The PDAA is expected to license, supervise, and ensure compliance for all digital asset service providers. It will also focus on aligning Pakistan’s framework with international standards, particularly those set by the Financial Action Task Force (FATF).
Web3 and digital asset consultant Arsalan Khan hailed the initiative, calling it “a maturing approach towards virtual asset regulation.” He emphasized that with global advisors like World Liberty Financial (WLF) and Binance founder Changpeng Zhao (CZ) involved in advisory roles, Pakistan has the potential to implement global best practices, ensuring clarity and compliance for startups and institutional players alike.
The initiative places Pakistan alongside global jurisdictions such as the UAE, Singapore, Hong Kong, and Japan, which have already taken proactive steps to regulate the fast-evolving digital finance space. By setting up a dedicated regulatory structure, Pakistan is not only aiming to mitigate financial risks but also to unlock economic opportunities within its burgeoning digital economy.
Muhammad Zohaib Khan, former chairperson of the Pakistan Software Houses Association (P@SHA), praised the move, stating that it positions Pakistan on the right track as the world embraces digital currencies and assets. “This is a great initiative considering the world’s progress towards digital assets. The future is all about digital assets,” he said, adding that the move would create new cybersecurity opportunities and pave the way for a potential government-backed virtual asset.
The digital asset ecosystem in Pakistan has largely operated in a grey area due to the lack of formal guidelines. Industry voices have long called for a coherent regulatory framework. Mutaher Khan, founder of data insights platform Data Darbar, emphasized the need for clear roles between regulators—namely the Securities and Exchange Commission of Pakistan (SECP) for investment-related aspects and the State Bank of Pakistan (SBP) for payments. He noted that while both institutions have their own sandboxes, coordinated policies are essential to enable growth and innovation in the crypto space.
Mutaher also pointed out that the SBP’s sandbox could facilitate the creation of payment frameworks, while the SECP is yet to roll out a comprehensive roadmap for cryptocurrency investments. He believes that the creation of PDAA is the first concrete step towards legitimizing crypto-based businesses in Pakistan, offering a pathway for local firms to enter the global crypto market.
According to the Ministry of Finance, the PDAA will also facilitate tokenisation of government assets and debt, and could even oversee regulated cryptocurrency mining, particularly using surplus energy—thereby opening new monetisation avenues. The ministry noted that Pakistan’s unregulated crypto market is currently estimated to exceed $25 billion, underlining the urgency for oversight.
Federal Minister for Finance and Revenue Muhammad Aurangzeb called the initiative a “future-oriented step to create a regulatory framework that protects consumers, attracts investment, and positions Pakistan as a credible player in financial innovation.”
Bilal Bin Saqib, CEO of the Pakistan Crypto Council, echoed this view, stating that the PDAA represents a historic opportunity to reshape Pakistan’s financial architecture, improve financial inclusion, and increase digital exports via Web3 technologies.
While an official timeline for the operationalisation of the PDAA has not been announced, the move is widely seen as a bold and necessary shift, aimed at embracing innovation while maintaining regulatory integrity in the digital finance age.
