If you trade crypto in Pakistan, you might have felt anxious, not only because of the volatile crypto market, but also due to the fear of an adverse action by the authorities or fraudulent dealers. Some of these risks may ease in days to come as Pakistan has formally set up the Pakistan Virtual Assets Regulatory Authority (PVARA) to regulate the virtual assets and blockchain activities. Established under the Pakistan’s Virtual Assets Ordinance 2025, the PVARA held its inaugural meeting in August, 2025.

What do we know about the new regulatory framework?

The President of Pakistan promulgated the Pakistan Virtual Assets Ordinance 2025 on July 8, 2025 with the stated objective of licensing, regulation, and supervision of virtual assets and virtual asset service providers.

By design, an ordinance is a temporary legislation valid for 120 days, unless the Parliament extends it for another 120 days, or passes it as an Act. Pakistan Virtual Assets Ordinance will be valid until November 4, 2025, if it is not extended or approved by the Parliament by then.

The process for making it a permanent law through parliamentary approvals is already underway. The ordinance was presented before the Senate on August 15, 2025, and in the National Assembly on September 5, 2025. It now stands as a bill under consideration. The Finance and Revenue Committees of both the houses are reviewing it. After they submit their recommendations, the bill will go through clause-by-clause reading and voting in both the National Assembly and the Senate before becoming an Act of Parliament.

How did Pakistan’s policy shift towards crypto?

Until early 2025, the government and the State Bank of Pakistan (SBP) followed a cautious approach towards crypto:

  • In 2018, SBP advised banks not to facilitate crypto transactions.
  • In 2022, the Financial Monitoring Unit (FMU) warned that virtual assets could heighten money laundering and terror-financing risks.
  • In 2023, the Federal Investigation Agency (FIA) issued notices to crypto traders and questioned Binance’s local representatives in a scam probe.

The confusion transformed into enthusiasm soon after the President of the United States Donald Trump entered office in January 2025:

  • In February 2025, the Federal Government formed the Pakistan Crypto Council (PCC).
  • In March, Binance founder Changpeng Zhao was named a strategic advisor to the PCC.
  • In May, Prime Minister Shehbaz Sharif announced diverting 2,000 megawatts of surplus electricity to crypto mining and Artificial Intelligence (AI) data centers.
  • In July, the SBP announced a pilot for a Central Bank Digital Currency (CBDC), and the President promulgated the Pakistan Virtual Assets Ordinance 2025.

What does the Virtual Assets Ordinance say?

The ordinance has 12 parts and three schedules dealing with various aspects of virtual assets regulation. It defines virtual assets as “digital representation of value that can be digitally traded or transferred and used for payment or investment purposes.” But it explicitly states the virtual assets would not be a legal tender in Pakistan. Legal tenders are coins or banknotes that must be accepted if offered in payment of a debt.

It outlines the composition and functioning of the Pakistan Virtual Assets Regulatory Authority (PVARA), to be governed by a 11-member board comprising a Chairperson, Governor State Bank, federal secretaries for the ministries of Finance, Law and Justice, Information Technology, Chairpersons of Securities and Exchange Commission of Pakistan (SECP), FBR, and Digital Pakistan Authority, Director General FIA, and two independent directors to be appointed by the Federal Government.

The authority will license virtual asset service providers (VASPs) across eight categories (e.g., advisory services, broker-dealers, and exchanges). Moreover, it sets out framework for consumer safety, dispute resolution, anti-money laundering and counter-terrorist finance and Shariah compliance of virtual assets.

What experts say about the ordinance?

Experts argue the framework needs tightening to align with leading regimes such as the EU’s Markets in Crypto-Assets Regulation (MiCA) and Dubai’s Virtual Assets Regulatory Authority (VARA).

Critics warn that the said ordinance currently imposes a high and opaque regulatory burden. Capital rules are one-size-fits-all, licensing fees and timelines are unclear, capacity building for the new regulator is undefined, and coordination among SBP, SECP, and FBR remains weak. They also note that the boundary between civil and criminal offenses is blurry, creating uncertainty for investigators, courts, and firms about when a compliance lapse becomes a crime.

To address this, experts propose a tiered regime that distinguishes small from large providers and phases in capital and compliance thresholds to support startups. They urge clear capacity‑building plans for a PVARA, plus a joint SBP–SECP–FBR task force to align supervision, AML/CFT and tax rules. A national consumer‑education campaign in local languages, periodic reviews of sandbox rules and compliance burdens, and an innovation track with mentorship, funding access and regular regulator–industry dialogue would also help.

Want to engage?

If you’d like to read the ordinance or share feedback with lawmakers, visit the National Assembly or the Senate websites. You’ll find the official text there. If you have a suggestion on improving this piece of law, you may contact the members of the Finance and Revenue committees of the National Assembly and the Senate. Their contact details are also available on their respective websites.