Written by Malik Abbas, CEO of CoinConnect
TL;DR
- Under Regulation 4 of the draft Virtual Asset Services Regulations, 2026, PVARA issues 10 distinct license categories — your license names exactly which you may provide.
- They range from Advisory (lowest barrier, PKR 25 million) to Exchange and token issuance (highest, PKR 1 billion).
- You can hold more than one category, but PVARA sets the combined capital and add-ons on a risk basis (Regulation 31(2)).
- Pure mining is not licensable; derivatives are licensable only where not already regulated by SECP or SBP.
- Picking the right category is the single biggest cost-and-risk decision in your whole entry — get it wrong and you over-capitalize or under-authorize.
Table of Contents
- How many PVARA license categories are there?
- Why the category you choose matters
- The 10 categories, one by one
- How categories combine (and incidental activities)
- The two special cases: mining and derivatives
- How to choose the right category
- FAQ
How many PVARA license categories are there?
There are 10 PVARA license categories under Regulation 4 of the Virtual Asset Services Regulations, 2026: advisory, broker-dealer, exchange, custody, transfer and settlement, lending and borrowing, derivatives and leverage, management and investment, and two issuance categories — fiat-referenced tokens and asset-referenced tokens. Each carries its own minimum capital and obligations.
This article is the map of all ten. For the broader licensing picture, start with our complete PVARA licensing guide; for the money detail, see PVARA capital requirements.
Conversions use an indicative rate of PKR 278 = USD 1 (June 2026).
Why the category you choose matters
A PVARA license is not a single, all-purpose permit. Regulation 5(3) states that a license "authorizes the VASP to provide only those categories of Virtual Asset Services which are expressly specified in the License." Step outside that scope and Regulation 5(4) is blunt: a licensee "shall not carry on any activity which falls within another category … unless it is also licensed for that category."
So the category is not a label — it is the boundary of what you may legally do, and it sets your capital, your handbook obligations and your supervisory burden. Choosing it correctly is the highest-leverage decision in your entry.
The 10 categories, one by one
Here is the full set, with the Regulation 4 definition, the Schedule I capital, and who typically needs each.
1. Advisory License — PKR 25 million (~$90,000)
Providing "personalized recommendations, on a professional basis, to a Customer … relating to one or more actions or transactions involving Virtual Assets" (Regulation 4(1)(a)). General market commentary and research are excluded. The lowest capital barrier — suited to advisory firms that do not touch customer assets. Governed by the Advisory Services Handbook (suitability assessments).
2. Broker-Dealer License — PKR 100 million (~$360,000)
"Dealing in Virtual Assets as principal or agent, arranging or facilitating orders … soliciting or accepting such orders" (Regulation 4(1)(b)). The intermediary's license. A firm that deals purely on its own account, without serving customers or holding their assets, is carved out. See our forthcoming deep dive, the PVARA Broker-Dealer license guide.
3. Exchange License — PKR 1 billion (~$3.6 million)
"Operating a Virtual Asset exchange, trading venue, order book, matching system, swap facility, or otherwise providing exchange or trading arrangements" (Regulation 4(1)(c)). The flagship — and most capital-intensive — category. Carries the heaviest conduct, surveillance and settlement obligations. Read the full PVARA Exchange license guide.
4. Custody License — PKR 200 million (~$720,000)
"Safeguarding, holding, controlling, or administering Customer Assets … including custody of private cryptographic keys" (Regulation 4(1)(d)). Pure self-custody software, where the customer keeps exclusive control of keys, is excluded. The backbone for any business that holds user assets, often paired with an exchange license.
5. Transfer & Settlement License — PKR 200 million (~$720,000)
"Transmitting, transferring, clearing, settling, or otherwise executing Virtual Asset transfers … on behalf of Customers, including where performed through a payment rail" (Regulation 4(1)(e)). This is the payments and remittance category — the right home for stablecoin-based cross-border transfer businesses, and frequently confused with the far more expensive exchange license.
6. Lending & Borrowing License — PKR 500 million (~$1.8 million)
"Operating, arranging, facilitating, or administering lending, borrowing, credit, margin, financing, or similar arrangements involving Virtual Assets" (Regulation 4(1)(f)). Covers crypto credit and financing products, including collateralized arrangements.
7. Derivatives & Leverage License — PKR 500 million (~$1.8 million)
"Offering, arranging, dealing in, or facilitating derivatives, margin or leveraged arrangements" (Regulation 4(1)(g)) — but only to the extent the activity is not already regulated by SECP or SBP. This is a coordinated category (see the special cases below).
8. Management & Investment License — PKR 200 million (~$720,000)
"Acting in a fiduciary or agency capacity for the purpose of managing or administering another Person's Virtual Assets, including portfolio or discretionary investment management … and responsibility for staking on behalf of Customers" (Regulation 4(1)(h)). The asset-management and staking-as-a-service category.
9. Issuance — Fiat-Referenced Token (stablecoin) — PKR 1 billion (~$3.6 million)
Issuance of a token referenced to fiat — a stablecoin — governed by section 31 of the Act. Requires PKR 1 billion capital plus a separate 100% segregated reserve under Regulation 34.
10. Issuance — Asset-Referenced Token (e.g. tokenized gold) — PKR 1 billion (~$3.6 million)
Issuance of a token backed by underlying assets — tokenized gold, for example — governed by section 32 of the Act. Like stablecoins, it requires PKR 1 billion plus a 100% reserve of the underlying assets, and the token "shall not be backed or derive its value from other Virtual Assets."
(Regulation 4 frames issuance as a single category; Schedule I splits it into these two for capital and reserve purposes, reflecting sections 31 and 32 of the Act.)
How categories combine (and incidental activities)
Most serious operators need more than one category — an exchange usually wants custody; a payments firm may want transfer plus issuance. Regulation 4(2) permits a person to "apply for one or more License Categories," and the license then specifies each.
Capital for multi-category licensees is not a simple sum. Regulation 31(2) lets PVARA set "the methodology for determining the applicable minimum paid-up capital and any additional prudential add-ons" on a risk basis. Plan for the highest applicable figure as your baseline, with add-ons layered for the extra risk each activity brings.
There is also a narrow incidental-activities allowance. Regulation 4(4) lets a license category cover activities "reasonably necessary and incidental" to the authorized service — but only if they are subordinate, not separately marketed, and do not change your risk profile. You cannot use it to smuggle in a second category by the back door (Regulation 4(5)).
The two special cases: mining and derivatives
Mining. Pure mining is not a licensable service. Regulation 4(10) confirms that "pure Virtual Asset mining, by itself, shall not constitute a Virtual Asset Service requiring a License." Only mining that involves customer assets or provides services to third parties is caught.
Derivatives. The derivatives category exists only in the gap left by other regulators. Where there is doubt whether a product is a security or derivative within SECP's or SBP's mandate, Regulation 4(1)(g) requires PVARA to "consult the relevant regulator and may decline to license the activity pending clarity." If you plan leveraged or derivative products, expect multi-regulator coordination.
How to choose the right category
Work from your actual activity, not your brand:
- Do you match orders between users? → Exchange.
- Do you move value across borders / run payment rails? → Transfer & Settlement.
- Do you hold customer assets or keys? → Custody.
- Do you intermediate trades for customers? → Broker-Dealer.
- Do you issue a token? → Issuance (FRT or ART), plus reserves.
- Do you only advise? → Advisory.
The most expensive mistake we see is a payments or brokerage business defaulting to the PKR 1 billion exchange category when its real activity sits two tiers lower. Match the category to the substance, then decide whether to enter on full or reduced capital via the sandbox, and through which route. If you want this mapped against your model, our PVARA licensing service does exactly that.
Frequently asked questions
Ten, under Regulation 4 of the Virtual Asset Services Regulations, 2026 — advisory, broker-dealer, exchange, custody, transfer and settlement, lending and borrowing, derivatives and leverage, management and investment, and two issuance categories (fiat-referenced and asset-referenced tokens).
Yes. Regulation 4(2) allows applying for one or more categories. The capital is set on a risk basis under Regulation 31(2), not by simply adding each category's figure together.
Usually the Transfer & Settlement category (PKR 200 million), which covers transmitting and settling virtual asset transfers, including via payment rails — not the more expensive exchange category.
No. Regulation 4(10) confirms pure mining is not a licensable virtual asset service. Only mining that involves customer assets or third-party services is caught.
Advisory, at PKR 25 million (~$90,000) minimum paid-up capital, provided the firm only gives recommendations and does not hold customer assets.
Both are issuance, but split for capital and reserve purposes — fiat-referenced tokens under section 31 and asset-referenced tokens under section 32. Both require PKR 1 billion plus a 100% segregated reserve.
Not sure which PVARA category fits your business? CoinConnect maps your actual activity to the right license category — so you budget for the license you need, not the one the headlines quote. Book a free 30-minute discovery call →
Last reviewed: June 2026. Based on the draft Pakistan Virtual Asset Services Regulations, 2026, published for public consultation. Provisions are subject to change pending finalization.
External sources: PVARA · SECP · State Bank of Pakistan