Pakistan Launches Crypto Sandbox to Test Digital Assets

TL;DR

• PVARA launched a regulatory sandbox for supervised crypto testing.

• Sandbox covers tokenization, stablecoins and remittance use cases.

• Pakistan signed MoU on stablecoin payments with SC Financial Technologies.

• Officials attended World Liberty Forum at Mar-a-Lago in Florida.

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Pakistan has launched a regulatory sandbox to test digital asset products under supervision. The move comes as authorities work to establish a formal structure for crypto oversight.

The Pakistan Virtual Assets Regulatory Authority confirmed the framework on February 20, 2026. The regulator said the sandbox will provide a controlled setting for innovation while maintaining regulatory monitoring.

Pakistan Regulatory Sandbox to Supervise Crypto Innovation

The sandbox allows companies to trial products before full authorization. Firms can test services in a live but supervised environment.

PVARA said the sandbox will support tokenization, stablecoins, remittances and on- and off-ramp systems. Tokenization converts real-world assets into blockchain-based tokens. Stablecoins are digital currencies linked to fiat value.

On- and off-ramp services enable conversion between fiat money and digital assets. These systems allow users to move funds between traditional banking and crypto platforms.

“The Pakistan Virtual Assets Regulatory Authority has formally approved and launched its Regulatory Sandbox for virtual assets,” PVARA said in a post on X. The authority added that guidelines and the application process will be published soon.

Broader Push to Formalize Digital Asset Sector

Pakistan has increased efforts to regulate digital assets in recent months. The government is exploring digital currency initiatives as part of measures to reduce cash usage.

Officials have stated that regulation aims to strengthen oversight while encouraging innovation. Authorities are also seeking to attract international investment into the sector.

The sandbox framework forms part of this regulatory roadmap. It provides structured supervision and allows regulators to monitor risks while companies test products.

Stablecoin Cooperation With World Liberty Affiliate

Earlier this year, Pakistan signed a memorandum of understanding related to stablecoin infrastructure. The agreement involves SC Financial Technologies, described as an affiliated entity of World Liberty Financial.

World Liberty Financial is a crypto-based platform launched in September 2024 linked to US President Donald Trump’s family.

According to PVARA, the memorandum sets the basis for cooperation on regulated stablecoin payment systems. The focus is on cross-border payment infrastructure. A Reuters report stated that the agreement aims to explore dollar-linked stablecoin use for international transfers.

International Engagement and Industry Discussions

Bilal bin Saqib, Chairman of PVARA, earlier this week attended the World Liberty Forum at Mar-a-Lago in Florida. The event included financial executives, crypto innovators and policymakers.

Saqib described the forum as a gathering focused on stablecoins, tokenization and financial innovation. He shared updates about the event on social media.

Representatives from firms including Goldman Sachs, Nasdaq, Franklin Templeton and Coinbase participated in discussions. The meetings centered on the future of finance and digital technology.

Pakistan’s regulatory sandbox now provides a formal channel for testing such innovations domestically. The framework introduces supervised experimentation while regulators build broader compliance rules.

Authorities have stated that more details will follow once the sandbox guidelines are published.

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