Pakistani authorities recently dismantled a $60 million international crypto-forex scam, according to reports that said 34 people were arrested in a coordinated crackdown on unregulated trading schemes. Furthermore, the move comes just as the country moves to formalize its digital asset market and open it to major global exchanges.

The operation was led by the country’s National Cyber Crime Investigation Agency (NCCIA), which targeted a network suspected of running fake crypto and foreign exchange investment platforms. The platforms were believed to be defrauding victims, both in Pakistan and abroad.

The investigators found that the group promoted fraudulent trading schemes using social media platforms with the goal of luring users by promising high returns on their investments.

Victims were convinced to join through fabricated profits, created to boost investor confidence. They were then asked to pay additional fees for various reasons. Once investors committed larger sums, their accounts were blocked and the funds siphoned off. All proceeds were then routed through local bank accounts and converted into cryptocurrency, which is far easier to move across the border.

The arrests represent a significant law enforcement action, but the officials have said that this is only a part of a broader effort to eliminate unregulated, cross-border financial activity that has been thriving in Pakistan thanks to its regulatory gray area.

Pakistan Rolls Out New Licenses For Major Exchanges

The bust comes at a time when Islamabad rolled out a new licensing regime for virtual assets under a dedicated regulator, the Pakistan Virtual Assets Regulatory Authority (PVARA). The new regulator was tasked with bringing crypto activities under formal supervision, focusing on licensing and AML controls, as well as consumer protection.

PVARA has so far issued No Objection Certificates (NOCs) to two major crypto exchanges – Binance and HTX. The approvals are not ful operating licenses, but they will still allow the two exchanges to register with local AML systems, establish subsidiaries, and prepare formal license applications.

The country’s Finance Minister, Muhammad Aurangzeb, commented on the new framework, describing it as evidence of Pakistan’s commitment to secure responsible innovation and financial discipline.

The country’s authorities are applying the carrot and stick strategy, which can be seen from the combination of the enforcement action and the regulatory rollout. The authorities are pushing strongly to shut down illicit operations, and at the same time, they are trying to create a legal pathway for compliant companies to enter its market, which is estimated to be one of the most active markets in the crypto industry.