Cryptocurrency in Pakistan is edging closer to becoming legal as the country moves to bring digital assets into its formal financial system. The State Bank of Pakistan (SBP) has confirmed that it will lift its long-standing ban on digital currencies once a clear regulatory framework is in place.
The revelation came during a meeting of the Senate Standing Committee on Finance and Revenue on Wednesday. Acting Deputy Governor Dr Inayat Hussain told lawmakers that SBP had “agreed in principle” to legalize virtual assets, though people would have to wait until the supporting rules are finalized.
Cryptocurrency in Pakistan: From Ban to Regulation
For years, Pakistanis were barred from trading or investing in cryptocurrencies. SBP had issued strict warnings, calling digital assets risky and prone to misuse. But that stance is now shifting.
“People will be allowed to buy and sell virtual assets once the legal framework is complete,” Dr. Hussain told the committee. He added that SBP would also withdraw the old circulars that blocked crypto transactions.
The committee, chaired by Senator Saleem Mandviwalla, was reviewing the Virtual Assets Bill, 2025, a government-backed law designed to give shape to this new policy.
PVARA Already in Place
The Committee deliberated on the government bill titled “The Virtual Assets Bill, 2025”.
The Bill aimed to regulate virtual assets following established international practices. It was also stated that the given Virtual Assets Authority will play a key role in combating money laundering, terror financing and other illicit activities.
The finance division, in a written briefing, informed that virtual assets are an evolving component of the modern financial ecosystem, offering new opportunities for innovation, investment, and economic growth. However, they also present significant regulatory challenges, particularly in ensuring investor protection, market transparency, and the integrity of financial systems.
To address these challenges, a dedicated regulatory arm for the licensing and supervision of Virtual Asset Service Providers (VASPs) is essential. Such an oversight mechanism not only safeguards investors but also fosters innovation, mitigates risks of misuse, and promotes confidence in the virtual asset market.
Recognizing the need for a comprehensive legal and regulatory structure, the Government of Pakistan promulgated the Virtual Assets Ordinance, 2025, on 8 July 2025. Following its promulgation, the Pakistan Virtual Asset Regulatory Authority (PVARA) was established as the primary regulatory body responsible for overseeing the virtual asset sector.
The Ordinance provides a robust legal framework enabling PVARA to license and supervise VASPs, prevent money laundering, terrorist financing, and other illicit activities, promote innovation and financial inclusion, encourage the development of Shariah-compliant virtual asset services and align domestic practices with international standards.
This framework aims to create a secure environment for virtual asset transactions, curb illegal activities such as fraud and money laundering, and position Pakistan as a competitive player in the global virtual asset landscape.
Committee’s Suggestions and Heated Words
During the session, members floated several recommendations. One proposal was to shift PVARA under the Finance Division instead of the Cabinet Division, reflecting the authority’s financial focus. Another was to set an age cap of 55 years for the post of chairperson, with at least five years of experience in digital finance and technology.
Senator Anusha Rehman cautioned against excluding younger professionals, saying,
People with five years of experience deserve a fair chance. We cannot shut the door on the new generation.
But the debate did not stay calm for long. Senator Afnan Ullah Khan accused the government of copying his private member bill on virtual assets and rebranding it as its own. He called the move “unethical” and “corrupt”, sparking a tense exchange with the Secretary of Law.
The committee later agreed to review Senate rules to prevent such disputes in the future. For now, deliberations on the bill have been pushed to the next meeting.
Cryptocurrency in Pakistan: What Lies Ahead
The SBP’s reversal is a landmark step for Pakistan’s financial system. Allowing cryptocurrencies under a regulated setup could open new doors for investors, tech startups, and even remittance channels. But it also raises tough questions: how quickly can the framework be enforced, and will it be strong enough to curb fraud and money laundering?
If the Virtual Assets Bill, 2025, is passed, Pakistan will join a growing list of countries that are moving from bans to regulation. The shift may finally give citizens a legal, transparent way to trade in digital currencies while putting the state firmly in charge of oversight.