Pakistan launches crypto sandbox to advance regulation plans: Details

Pakistan has officially launched a crypto testing framework for regulated digital assets.

In a statement on the 20th of February, the Pakistan Virtual Assets Regulatory Authority (PVARA) said it will soon announce full guidelines for potential issuers who wish to participate in the ‘sandbox.’

Part of the statement read, 

“The Sandbox creates a live, supervised environment for testing real-world use cases, including tokenization, stablecoins, remittances, and on- and off-ramp infrastructure under regulatory oversight.”

Source: X

Pakistan’s crypto plan

Stablecoins have gone mainstream, while tokenized markets are picking up steam, now worth $25 billion. 

The U.S, U.K., EU, UAE, Hong Kong, and others have rolled out crypto regulatory frameworks or are working towards one.  

With crypto’s mainstream momentum becoming inevitable, Pakistan unveiled plans to gradually join major jurisdictions in offering regulatory clarity for the sector. In this ambitious goal, the country tapped Binance founder Changpeng Zhao (CZ) as a strategic advisor to the Pakistan Crypto Council (PCC). 

The regulatory sandbox was first announced in mid-2025 to test the budding sector before finally approving it. Fast forward to 2026, and the framework is now live, bringing the country closer to regulatory clarity. 

That said, the progress could help unlock the sector that has seen tremendous growth and adoption among Pakistani people. According to Chainalysis, Pakistan ranked second, after India, in crypto adoption across the APAC region in 2025. Globally, it was the third after India and the U.S. 

In January, Pakistan announced a partnership with Donald Trump family-backed World Liberty Financial (WLFI), adding that, 

“It will explore innovation in digital finance, particularly the use of stablecoins for cross-border transactions, signalling growing global interest in Pakistan as a key market for digital assets.”

For CZ, however, Pakistan’s bold strategy for the digital assets could pay off quickly in the next few years. 

“If we keep moving at this speed in five years, Pakistan will be one of the crypto leaders in the world.”

Already, PVARA had begun issuing No Objection Certificates (NOCs), which the regulator said is the first step towards full licensing.

Overall, the sandbox will evaluate compliance weaknesses and various risks like anti-money laundering (AML) gaps. This would help fine-tune rules before full rollout of the framework. 

Final Summary 

• Pakistan announced that its long-awaited crypto sandbox was live, and more details on licensing would be shared soon. 
• The report findings on the sandbox would help tighten its broader rules for the sector before unveiling the full crypto framework.