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ISLAMABAD: The Senate on Friday passed the Virtual Assets Bill, 2025, paving the way for the establishment of a dedicated regulatory authority to license, regulate and supervise virtual asset activities across the country.
The Pakistan Virtual Assets Regulatory Authority (PVARA) was already set up under an ordinance approved in July last year. The bill’s passage will provide legal cover to the authority’s establishment, as the ordinance is set to collapse in early March.
The House suspended rules to take up the bill, moved by Finance Minister Muhammad Aurangzaib, for immediate consideration.
The bill’s preamble, seen by Dawn, states that it was expedient to establish a dedicated virtual assets regulatory authority to license, regulate and supervise virtual assets and virtual asset service providers to “ensure investor protection, transparency and market integrity in Pakistan”.
It says that it’s necessary to provide a comprehensive legal framework to empower the said authority to combat money laundering, terrorist financing, proliferation financing and other illicit activities involving virtual assets, in accordance with international standards.
Virtual assets are digital representations of value that can be traded, transferred or used for payment and investment purposes through electronic networks, typically using blockchain or distributed ledger technology.
They include cryptocurrencies such as Bitcoin and Ethereum, stablecoins linked to fiat currencies or other assets, digital tokens issued for fundraising or utility purposes and other blockchain-based assets. Unlike traditional currencies issued by central banks, virtual assets operate on decentralised systems and derive their value from market demand, underlying assets or programmed mechanisms.
The bill will now be forwarded to the National Assembly for approval before being submitted to President Asif Ali Zardari, whose approval will make it an act of parliament.
“The passage of this bill through the Senate represents a defining moment for Pakistan’s digital economy,” PVARA quoted its chairman, Bilal bin Saqib, as saying, according to Arab News. “We are transforming years of unregulated activity into a transparent, secure, and investor-friendly ecosystem that positions Pakistan as a credible jurisdiction for virtual assets.”
Regulatory authority
The bill provides for the establishment of the Pakistan Virtual Asset Regulatory Authority, envisioning it as an autonomous corporate body empowered to licence, regulate and supervise virtual asset service providers and issuers in the country.
Elaborating on the body’s functions, the legislation says it will “protect customers and investors and the integrity of Pakistan’s virtual asset markets by establishing and enforcing appropriate safeguards and conduct of business requirements, prudential and operational-resilience, risk-management standards, and measures to prevent money laundering, terrorist financing and other illicit use of virtual assets”.
It will also attract investment and encourage companies operating in the field of virtual assets to base their businesses in Pakistan.
Moreover, PVARA will “promote responsible innovation, digital financial inclusion and the development of compliant virtual asset markets within a framework that manages risks and supports financial stability and market integrity”.
The body will “promote, develop, govern and regulate the adoption, deployment and scalable use of blockchain technology and distributed ledger technology (DLT) across Pakistan”, the bill said.
PVARA will coordinate with the Financial Monitoring Unit, National Anti-Money Laundering and Counter Financing of Terrorism Authority and other relevant authorities, as well as law enforcement agencies, to combat money laundering, terrorist financing and other illicit activities associated with virtual assets, in accordance with the Anti-Money Laundering Act, 2010, other applicable laws and international standards.
The regulatory body will also advise the government on “regulatory, supervisory, technical or emerging-risk matters relating to virtual assets, digital asset markets, tokenisation, stablecoin structures, blockchain, distributed ledger technology, cyber-risks or any matter connected with its mandate”.
The bill also authorises PVARA to devise “regulations, standards, directives, guidelines, handbooks and circulars, or any other instrument”, consistent with the objectives of the legislation and other applicable laws.
It will also be authorised to set risk-management, cybersecurity, data protection and technical standards and “issue, vary, suspend or revoke licences, approvals or directives under this Act and prescribe conditions for such actions”.
The body will also be empowered to impose administrative sanctions in accordance with the provisions of the PVARA law and “levy such fees, charges and penalties as may be prescribed by rules” devised under this law.
It further details that the body will comprise a chairperson — who will be appointed by the federal government — two secretaries, from the law and finance ministries each, State Bank of Pakistan’s governor, Securities and Exchange Commission of Pakistan chairperson, National Anti-Money Laundering and Counter Financing of Terrorism Authority chairman, Pakistan Digital Authority chairperson and two independent directors “with proven expertise and a strong track record possessing expertise relevant to virtual asset markets, digital technology and digital finance”.
The directors will also be appointed by the federal government. “The members of the authority, other than ex officio members, shall hold office for a term of three years and shall be eligible for one further term of three years,” the bill says.
Penalties
The bill states that “whoever, wilfully, provides an unlicensed virtual asset service shall be punishable with imprisonment for a term up to five years, or with fine up to Rs50 million, or both”.
It adds that whoever conducts an initial virtual asset offering in contravention of the rules and regulations established under the PVARA law shall be punishable with imprisonment for a term of up to three years or with a fine of up to Rs25m or with both.
The bill also penalises market manipulation and insider trading.
It states that “a virtual assets appellate tribunal shall be established and no court shall take cognisance of a legal dispute under this Act or the rules or regulations made thereunder to which the jurisdiction of the Virtual Assets Appellate Tribunal extends”.
The tribunal’s jurisdiction has been described as: “any virtual asset service provider, licensee, or any other person aggrieved by an order of the PVARA may prefer an appeal before the Virtual Assets Appellate Tribunal within 30 days of the date on which the order was communicated.”
The government announced in July that President Asif Ali Zardari had approved the ‘Virtual Assets Ordinance, 2025’ to establish an independent regulator for virtual assets and cryptocurrencies.
It was issued under Article 89 of the Constitution, which allows the president to issue an ordinance in urgent matters when both houses are not in session; such ordinances remain in effect for 120 days and do not require passage through the National Assembly and Senate.
In November last year, the Senate extended the Virtual Assets Ordinance, 2025, for another 120 days.
Published in Dawn, February 28th, 2026
