Islamabad: The Senate of Pakistan has passed the Virtual Assets (Amendment) Bill, paving the way for the establishment of a dedicated regulatory authority to oversee virtual assets and related service providers across the country.
Under the approved legislation, a regulatory authority will be set up to license, regulate, and supervise virtual assets and Virtual Asset Service Providers (VASPs). The authority will be responsible for developing a comprehensive framework to ensure transparency, accountability, and compliance within Pakistan’s rapidly evolving digital asset market.
According to the provisions of the bill, the newly formed authority will take measures to prevent money laundering, terrorist financing, and the unlawful use of virtual assets. It will introduce regulatory standards and operational guidelines aimed at curbing financial crimes linked to digital currencies and blockchain-based assets. This move aligns Pakistan with international best practices and global compliance standards in the financial sector.
The authority will also be tasked with safeguarding consumers and investors participating in Pakistan’s virtual asset market. By establishing clear regulatory procedures and compliance requirements, the body aims to reduce risks associated with fraud, market manipulation, and unregulated operations. Officials say this will help build investor confidence and promote responsible innovation in the fintech and digital finance sectors.
In addition to issuing regulatory frameworks and guidelines, the authority will have the power to grant, suspend, or revoke licenses of virtual asset service providers operating within or targeting Pakistan. Service providers will be required to obtain proper authorization before offering services such as cryptocurrency exchanges, digital wallets, token issuance, or other blockchain-related financial activities.
The bill also outlines strict penalties for non-compliance. Any individual or entity providing virtual asset services without a valid license may face imprisonment of up to five years and a fine of up to Rs50 million. These stringent penalties are intended to deter illegal operations and ensure adherence to regulatory standards.
Furthermore, the authority will be empowered to enter into cooperation agreements and information-sharing arrangements with regulatory bodies and agencies in other countries. This provision aims to strengthen cross-border coordination, particularly in tracking illicit financial flows, combating cybercrime, and addressing transnational financial risks associated with virtual assets.
The law will apply to all virtual asset service providers and issuers operating within Pakistan, as well as those operating abroad but offering services to individuals or entities in Pakistan. This extraterritorial application is designed to prevent regulatory loopholes and ensure that foreign-based operators targeting Pakistani users are also subject to oversight.
Financial experts note that the passage of the amendment bill marks a significant step toward formalizing Pakistan’s stance on digital assets. In recent years, virtual currencies and blockchain-based financial instruments have gained popularity among investors and technology enthusiasts, despite operating in a largely uncertain regulatory environment. The new framework is expected to provide clarity, reduce ambiguity, and encourage legitimate business activity.
Supporters of the bill argue that effective regulation will not only mitigate risks but also create opportunities for innovation, investment, and economic growth. By establishing a structured and monitored environment, Pakistan may attract fintech startups, technology developers, and international investors seeking regulatory certainty.
At the same time, authorities have emphasized that strict compliance requirements will be enforced to ensure that the virtual asset ecosystem does not become a channel for illicit activities. The regulatory authority is expected to coordinate closely with financial institutions, law enforcement agencies, and international partners to maintain oversight and enforce the law.
With the Senate’s approval, the bill represents a milestone in Pakistan’s efforts to modernize its financial regulatory landscape in response to emerging digital technologies. Further procedural steps are expected before the law is fully implemented, after which the formation and operationalization of the regulatory authority will begin.
