Pakistan Approves Virtual Assets Act to Regulate Digital Currencies

Pakistan Approves Virtual Assets Act to Regulate Digital Currencies
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Pakistan has passed the Virtual Assets Act, 2025, establishing a legal framework to regulate cryptocurrencies and digital assets, The Halal Times reported. The law creates the Pakistan Virtual Asset Regulatory Authority (PVARA) to license and oversee crypto businesses, enforce anti-money laundering rules, and protect consumers. This move legitimizes the crypto sector, which previously operated in a legal grey area, and introduces penalties for unlicensed activity.

PVARA will work independently with support from government bodies like the State Bank of Pakistan (SBP) and the Securities and Exchange Commission (SECP). The Act also includes a regulatory sandbox to encourage innovation by allowing startups to test products under supervision. A Shariah Advisory Committee will ensure compliance with Islamic finance principles.

The SBP plans to pilot a Central Bank Digital Currency (CBDC), supported by the new law’s framework. The Act aligns Pakistan with global standards, boosts investor confidence, and aims to curb illegal activities through strict KYC and AML requirements.

The law is currently an ordinance and must be ratified by Parliament within 120 days. If approved, Pakistan will solidify its position as a digital finance leader in South Asia, fostering innovation, consumer protection, and financial inclusion.