Your cousin bought a mining machine last year. He keeps it running at night because the electricity is "cheaper" then. Or maybe a friend told you he earns from crypto mining and wants you to invest. Before you spend money on rigs, you need the actual legal position in Pakistan in 2026. It changed a lot in the last two years.
Is crypto mining legal in Pakistan?
Yes, with conditions. Mining for yourself, with your own money and your own equipment, is not a licensed activity under the Virtual Assets Act 2026. The regulator says so in its own FAQ. But the moment you mine with other people's money, or sell mining services to others, you cross into licensed territory.
The old position was different. For years the State Bank's 2018 circular told banks to stay away from virtual assets, and people assumed mining was banned too. The Virtual Assets Act 2026 replaced that with a licensing system. Pakistan now has a dedicated regulator for virtual assets, the Pakistan Virtual Assets Regulatory Authority (PVARA).
What the Act says about mining
Section 37(2) of the Virtual Assets Act 2026 is the key line. Pure virtual asset mining, on its own, does not count as a Virtual Asset Service. So a person running a machine at home, mining for themselves, does not need a licence.
But section 37(3) gives PVARA a tool for later. If the Authority sets up a registration framework for mining operators above certain thresholds of scale, energy use or hash rate, those operators must comply. The law is written so small miners stay free and big operations can be pulled under oversight when the Authority decides to.
The full rule sits in the PVARA licensing FAQ: mining with customer assets or customer funds, or providing services to third parties on a professional basis, is treated as a Virtual Asset Service. That needs a licence.
When mining needs a licence
PVARA's licence categories include "Mining Related Virtual Asset Services". That covers providing mining, validation or related infrastructure services for virtual assets.
The minimum paid-up capital for that licence category is Rs 500 million. That is not a hobby number. It tells you the regulator expects licensed mining businesses to be real companies with real money behind them.
Running an unlicensed virtual asset business in Pakistan can mean up to five years in prison or a fine up to Rs 50 million under section 54 of the Act. If you take people's money and promise to mine for them without a licence, that is exactly the risk you are running.
The electricity problem
Here is where most mining plans in Pakistan die. Mining machines eat electricity. A single rig can pull as much power as several homes.
Stealing electricity to run mining rigs is a separate crime with its own chapter in the Pakistan Penal Code. The Criminal Law (Amendment) Act 2016 inserted Chapter XVII-B, sections 462-G to 462-P, on offences relating to electricity.
The penalties are serious:
- Tapping or tampering with transmission lines: up to three years rigorous imprisonment or a fine up to Rs 10 million (section 462-H).
- Tampering with distribution lines: up to three years or a fine up to Rs 3 million (section 462-I).
- Meter tampering by a domestic consumer: up to two years or a fine up to Rs 1 million (section 462-J).
- Meter tampering by an industrial or commercial consumer: up to three years or a fine up to Rs 6 million (section 462-K).
- Damaging or destroying lines or meters: up to seven years and a fine of at least Rs 3 million (section 462-M).
Cases under this chapter start on a complaint from an authorised officer of the government or the power company, not below Grade 17 (section 462-O). The money lost to the power company is also recovered from you as arrears of land revenue (section 462-N).
So the real legal risk for mining in Pakistan is rarely the Act itself. It is the meter. Run a rig on stolen power and you are not a crypto entrepreneur. You are an electricity thief with expensive machines that can be seized.
What about the 2,000 MW promise?
In May 2025, Pakistan announced it would allocate 2,000 megawatts of surplus electricity to Bitcoin mining and AI data centres. That announcement got big headlines.
It is not a licence for anyone. It is a policy direction about surplus power. No mining licences have been issued yet, and the 2,000 MW is a plan, not a permit. If you are reading this to decide whether to buy rigs, treat the announcement as background, not as permission.
What about the State Bank?
The State Bank of Pakistan's BPRD Circular Letter No. 10 of 2026 replaced the old 2018 ban. Banks may now open client money accounts in Pakistani rupees for licensed virtual asset service providers. But banks are still barred from investing, trading or holding virtual assets with their own funds or customer deposits.
For a miner this matters when you try to pay for machines or cash out. No licensed local exchange exists yet, so banking rails for crypto money remain thin.
What this means for you
- Mining at home with your own money and your own electricity is not a licensed activity.
- Mining with other people's money, or selling mining services, needs a PVARA licence with Rs 500 million capital.
- Stealing electricity for rigs is a criminal offence under PPC sections 462-G to 462-P with jail time and big fines.
- The 2,000 MW announcement is not a permit. No mining licences have been granted yet.
- If someone offers you a share in a mining farm with guaranteed returns, ask for their PVARA licence. They will not have one.
The honest summary: personal mining sits in a legal grey zone that the law currently tolerates, commercial mining needs a licence that nobody has yet, and electricity theft turns mining into a crime. If you want the broader picture, read whether cryptocurrency is legal in Pakistan and whether Bitcoin is legal in Pakistan. For stablecoins, see the position on USDT. More guides live on the Lexiber blog.
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