Pakistan authorities dismantle $60 million international crypto fraud network

Pakistani authorities have busted a $60 million international crypto fraud network. The authorities said they carried out the crackdown on perpetrators of several unregulated trading schemes, arresting more than 34 suspects.

The development comes as the country continues its shift towards a formal crypto regime amid moves to open the industry up to licensed global companies.

The operation was led by the National Cyber Crime Investigation Agency (NCCIA), targeting a network accused of running a fraudulent crypto and foreign exchange investment platforms that targeted victims both locally and internationally.

Pakistani authorities claimed that the group promoted their fraudulent schemes on social media, luring users with the promise of high returns.

Law enforcement nabs crypto fraud network

According to Pakistani authorities, victims were initially shown fabricated proof of profits to build confidence before being asked to pay additional fees under various pretexts. Once their victims commit larger sums, the perpetrators move to block their accounts and steal their funds.

Proceeds were routed through several bank accounts before they were moved into digital assets and then moved across borders.

The latest effort marks a major move by law enforcement as part of a broader effort to eliminate the type of unregulated, cross-border activity that has flourished in the absence of regulations in the crypto industry in Pakistan.

The bust also comes as Islamabad rolls out a new licensing regime for virtual assets under its dedicated regulator, the Pakistan Virtual Assets Regulatory Authority (PVARA). The authority has been tasked with bringing crypto activities under formal supervision.

PVARA has also been charged with focusing on licensing, anti-money laundering controls, and consumer protection.

The enforcement action and the regulatory rollout point to a clear strategy. The authorities are moving aggressively to shut down illicit operators while creating a legal pathway for large, compliant firms to enter one of the most active crypto markets in the world.

According to Bilal Bin Saqib, chairman of PVARA, the efforts of PVARA will provide support to the 40 million user base in the market.

Pakistan continues to make moves in the crypto industry

Aside from its regulatory push and enforcement against illicit actors, PVARA has issued No Objection Certificates (NOCs) to Binance and HTX. The certificates will allow both firms to kickstart their licensing processes. They are expected to register with the country’s Anti-Money Laundering system, which will prepare them for a full licensing application.

“This phased approach allows us to begin providing AML-registered cross-border services to Pakistani users while we continue working closely with PVARA toward full authorization,” Binance said in a statement.

According to a previous Cryptopolitan report, Pakistan also signed a memorandum of understanding (MoU) with Binance. Under the terms of the agreement, the exchange is expected to provide guidance to the country as it prepares to explore tokenizing up to $2 billion in state-owned assets.

Binance will provide expertise on blockchain-based distribution of treasury bills and commodity reserves, including gas, metals, and commodities.

In addition, Pakistan recently announced plans to launch its first stablecoin as it continues to eye the launch of a central bank digital currency (CBDC).

“We want to be at the forefront of this financial digital innovation that is happening. Why should we be at the tail-end of it when we have the muscle and the adoption?” Bilal Bin Saqib said.

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