In a significant policy development, the federal government of Pakistan has initiated the formal implementation of its virtual asset regulatory framework under the newly approved Virtual Assets Act, 2025. The move marks a turning point in the country’s stance toward digital assets and reflects an intent to bring structure, transparency, and oversight to the rapidly evolving crypto landscape.
A high-level meeting was held in Islamabad this week, bringing together key stakeholders from the banking sector, exchange companies, and representatives of the jewellery industry. The primary objective of the meeting was to brief participants on the provisions of the Virtual Assets Act, which was officially ratified on July 9, 2025, following necessary approvals from the Cabinet, the Prime Minister, and the President.
A key highlight of the new legislation is the formation of the Pakistan Virtual Asset Regulatory Authority (PVARA). This newly constituted body has been tasked with licensing, supervising, and regulating all entities involved in virtual asset services. Its scope includes oversight of cryptocurrency transactions, digital wallets, and other blockchain-enabled financial activities. Importantly, PVARA will ensure full compliance with global standards, including those laid out by the Financial Action Task Force (FATF), particularly in areas such as anti-money laundering (AML) and counter-terrorist financing (CFT).
During the meeting, stakeholders were informed that banks and exchange companies would be eligible to apply for licenses under this regulatory framework, enabling them to legally operate in the virtual asset domain. This paves the way for institutional participation in crypto markets, a move that could help mainstream digital asset services in Pakistan under regulated conditions.
The meeting was also attended by State Bank of Pakistan (SBP) Governor Jameel Ahmad, who reaffirmed the central bank’s commitment to digital innovation in the financial sector. He noted that SBP is in the final stages of drafting legislation for a central bank digital currency (CBDC) and confirmed that a pilot launch is on the horizon. The CBDC is expected to offer a government-backed digital alternative to cryptocurrencies while maintaining regulatory control and enhancing financial efficiency.
This latest development builds on the government’s earlier move in February 2025, when it announced the creation of the Pakistan Crypto Council. The Council was set up to serve as a national think tank and advisory body to support the integration of virtual assets into the financial system and to advise on evolving policy challenges.
Pakistan’s growing focus on the regulation of virtual assets reflects a broader regional trend toward formalizing digital finance and reducing reliance on informal channels. As the government seeks to balance innovation with compliance, the introduction of PVARA and the upcoming CBDC pilot may lay the groundwork for a more transparent and secure digital economy.
The licensing of banks and exchange firms under this framework signals a shift toward legitimizing digital assets as part of Pakistan’s broader financial infrastructure. It also positions the country to attract investment and foster technological advancement while aligning with international regulatory expectations.