In what could mark a turning point for Pakistan’s financial system, the State Bank of Pakistan (SBP) has announced plans to legalize virtual assets under a regulated framework and introduce its own central bank-backed digital currency.
The development was shared during a Senate Finance Committee meeting, chaired by Senator Saleem Mandviwalla. Dr. Inayat Hussain, Deputy Governor of SBP, told the committee that the advisory declaring cryptocurrency “illegal” will soon be withdrawn, paving the way for a new legal structure to govern digital assets.
Digital Rupee and Limited Crypto Transactions
Dr. Hussain explained that Pakistan’s upcoming digital rupee will be issued exclusively by the SBP and will serve as the primary channel for purchasing and holding virtual assets. This means Pakistanis will have a legal and secure option to invest in cryptocurrencies, though transactions will remain restricted within a controlled ecosystem.
The decision comes against the backdrop of massive public interest in crypto—Senator Afnanullah Khan revealed that Pakistanis have already invested an estimated $21 billion in various digital currencies, despite the lack of regulation.
Read more: Why the rupee keeps losing against the US dollar: Explained
Virtual Asset Bill 2025
To manage this new sector, the government has drafted the Virtual Asset Bill 2025, which will apply nationwide. It proposes the establishment of a Virtual Asset Regulatory Authority (VARA) responsible for licensing, oversight, and compliance. The authority’s board will include top officials from SBP, Finance, Law, IT, FBR, SECP, and FIA.
Barrister Syed Shehroze, a consultant from the Ministry of Law and Justice, made the clarification that while digital assets will be transferable nationwide, they cannot be utilized to purchase goods or services outside the ecosystem. Instead, their role will be limited to investment and controlled trading.
Safeguards and Investor Protection
The bill introduces strong AML/CFT (anti-money laundering and counter-terror financing) measures in line with FATF standards. It also includes strict rules to prevent insider trading, ensure data privacy and protect investors from fraud.
Although some senators had raised questions regarding the proposed $10,000 transaction limit, most welcomed the initiative as a long-overdue step to bring Pakistan’s crypto economy out of the shadows. Final deliberations on the bill are expected in the next committee meeting.