PVARA licensing: classes, capital, and fit-and-proper tests

Three ways to see it

1. 1

   PVARA, the Pakistan Virtual Asset Regulatory Authority, was established under the Virtual Assets Act 2026 to be the single licensor and supervisor of virtual asset activities in Pakistan. It sits separately from SBP and SECP because virtual assets do not fit cleanly into either banking or capital markets. PVARA defines the activity classes, sets capital floors, runs fit-and-proper tests on owners and senior managers, and shares supervisory data with SBP, FBR, and the FMU. A bank does not licence a VASP. PVARA does. The bank's job is to verify the licence and to refuse business where the licence is missing, expired, suspended, or out of scope.

2. 2

   There are five activity classes you must memorise. Class A: virtual asset exchange (matching buy and sell orders, rupee on/off ramp). Class B: custody and wallet services (holding private keys for clients). Class C: broker dealer (executing trades on a client's behalf). Class D: transfer service (moving virtual assets between addresses for a client, including cross-border). Class E: token issuer (creating and selling new virtual assets, including stablecoin issuance). A single legal entity can hold more than one class but must show capital and controls for each. The classes matter to the bank because the suspicious-pattern profile differs sharply: an exchange has constant two-way rupee flows, a custody-only firm has almost none.

3. 3

   Capital floors are set in PKR and indexed annually. As of the May 2026 PVARA framework, indicative minimums are: Class A exchange PKR 200 million, Class B custody PKR 100 million, Class C broker dealer PKR 50 million, Class D transfer service PKR 75 million, Class E token issuer PKR 500 million for non-stablecoin and PKR 1 billion plus full reserve attestation for stablecoin. The capital must be unencumbered, held in PKR or eligible foreign currency at a scheduled bank, and reported monthly. Banks should refuse to release capital below the floor and should escalate any drawdown that crosses the threshold without PVARA approval. The capital floor is not a tax. It is a self-insurance pool for customer claims when something goes wrong.

The why-tree

Try this with Claude

AI-edge prompt: 'You are a PVARA-aware corporate banking analyst. I will paste a fictional VASP application packet (cover letter, owner CVs, capital proof, source-of-wealth declarations). Identify the three weakest points, the two missing documents, and tell me whether to proceed to credit committee or return for cure. Cite specific PVARA classes and SBP AML circulars in your reasoning.' Then paste a sample packet and read the answer adversarially.