Pakistan and Kazakhstan Push Crypto Regulation

Pakistan's new law establishes the Pakistan Virtual Assets Regulatory Authority (PVARA) as the permanent federal regulator, an upgrade from its temporary status created by a presidential ordinance in July 2025. This move was driven partly by conditions tied to an International Monetary Fund (IMF) programme. The act imposes a strict licensing regime for all digital asset platforms, custodians, and token issuers. Unlicensed operations face severe penalties, including fines of up to 50 million Pakistani Rupees and prison sentences as long as five years, bringing comprehensive oversight to a market with millions of users. This regulation follows a massive wave of adoption, with Pakistan ranking third globally in the 2025 Chainalysis Global Crypto Adoption Index. The country's demographic is a key driver, with 70% of the population under the age of 30, who have increasingly turned to digital assets amid high inflation and low foreign reserves. Kazakhstan's $350 million allocation will not be used for direct crypto purchases but will target investment vehicles, derivative instruments, and shares in blockchain infrastructure companies. This strategic investment from the nation's $69.4 billion in reserves specifically identifies Ethereum and other smart contract platforms as priority areas. The central bank's investment, expected to start by May 2026, builds on an existing regulatory foundation. Kazakhstan's Law "On Digital Assets" came into force in April 2023, legalizing crypto mining under a license and mandating that all crypto transactions take place on exchanges registered within the Astana International Financial Centre (AIFC). The country is also a leader in Central Bank Digital Currencies (CBDCs), having already launched its "Digital Tenge" in 2023. The CBDC is being integrated into the economy, with pilot programs testing its use for everything from school lunch vouchers to financing railway construction.