The Pakistan Virtual Assets Regulatory Authority (PVARA) is working on a new regulatory framework that aims to align the country’s growing cryptocurrency market with Islamic financial principles. The initiative comes as digital assets continue to gain popularity in Pakistan and follows recent discussions on the religious status of cryptocurrencies after comments and a fatwa by Mufti Taqi Usmani.
According to reports, PVARA plans to introduce a dual regulatory framework that combines legal oversight with Shariah evaluation. The proposed system is designed to ensure that virtual assets are not only technically secure and legally compliant but also assessed for their compatibility with Islamic finance.
The authority says the framework will focus on consumer protection, financial transparency, technological assessment, and responsible innovation. It aims to provide clear guidelines for cryptocurrency exchanges, blockchain-based businesses, and digital asset service providers operating in Pakistan.
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Pakistan is estimated to have around 40 million cryptocurrency users, making it one of the largest emerging crypto markets in the region. However, the absence of a comprehensive regulatory framework has created uncertainty for investors, businesses, and financial institutions. Officials believe that introducing structured regulations will help reduce fraud, improve investor confidence, and support the safe growth of the digital economy.
The proposed Shariah review mechanism is also expected to address concerns among Muslim investors regarding the permissibility of digital assets under Islamic law. By involving both financial and religious experts, PVARA hopes to develop regulations that encourage innovation while respecting the country’s religious and legal values.
The initiative reflects Pakistan’s broader efforts to modernize its financial system and establish a secure environment for digital finance. If implemented, the new framework could provide greater clarity for cryptocurrency users, attract investment in blockchain technology, and strengthen Pakistan’s position in the rapidly evolving global digital asset industry.
The proposal is still under discussion, and further consultations with regulators, Islamic scholars, and industry stakeholders are expected before the framework is finalized.
