🇵🇰 Pakistan Prepares for Digital Currency Pilot & Virtual Asset Regulations

Pakistan is moving swiftly to modernize its financial landscape with two major initiatives:

1. Central Bank Digital Currency (Digital Rupee) Pilot

Pilot in sight: SBP Governor Jameel Ahmad announced at the Reuters NEXT Asia summit (July 9, 2025) that Pakistan is “building up our capacity on the central bank digital currency” and anticipates launching a pilot soon .

Strategic partners: The central bank is collaborating with tech firms to test the Digital Rupee in real-world scenarios alongside broader monetary reforms.

Macro backing: The pilot aligns with Pakistan’s monetary policy success—interest rates have dropped from 22 percent to 11 percent over the past year, inflation is at a nine-year low of roughly 3 percent, and foreign reserves stand at about $14.5 billion .

2. Virtual Assets Regulatory Framework (PVARA)

Virtual Assets Ordinance, 2025: Issued July 8, 2025, by presidential ordinance, this establishes the Pakistan Virtual Asset Regulatory Authority (PVARA) as an autonomous regulator for licensing and oversight of crypto services .

Governance & mandates:

Board made up of key officials: SBP Governor, SECP chair, secretaries of Finance, Law & Justice, IT, FBR, and the Digital Pakistan Authority, plus two independent directors .

Mandated to license VASPs, enforce FATF-aligned AML/CFT rules, run a Sharia Advisory Committee, support regulatory sandboxes and “no‑action” letters, and set up a Virtual Assets Appellate Tribunal .

Government role: The cabinet’s formal approval on July 8, 2025, marks a watershed moment following the PCC’s establishment in March. A unified strategy is emerging—courts, sandbox initiatives, Islamic compliance, and strategic advisory roles .

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🔗 Broader Landscape & Implications

Pillar Description

**Pakistan Crypto Council (PCC)** Launched March 14, 2025, chaired by Finance Minister Muhammad Aurangzeb with Bilal Bin Saqib as CEO. They’ve appointed Changpeng Zhao as strategic advisor, and are steering key efforts such as drafting regulations, launching a Bitcoin reserve, and planning mining hubs .

Strategic energy use The PCC proposes using surplus electricity for Bitcoin mining and AI data centers—leveraging national assets to support digital infrastructure .

International alignment The framework is designed to meet FATF obligations and mirror best practices from UAE, Singapore, Japan, and others .

Financial system impact While Pakistan historically warned against crypto, the new law and pilot signal a shift toward embracing controlled innovation. SBP warns institutions to stay out until licensing is in place—but this stance will soon evolve .

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🧭 Why It Matters

Financial modernization: A sovereign digital currency could streamline payments, foster financial inclusion, and reduce reliance on physical cash.

Crypto innovation: A regulated environment invites startups, foreign investors, and domestic entrepreneurs to develop blockchain-based solutions.

Energy & economic strategy: Utilizing excess power for Bitcoin mining and AI aligns digital innovation with economic pragmatism.

Global credibility: FATF-compliant frameworks reduce AML/CFT risks and improve Pakistan’s standing as a credible player in the global digital economy.

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✅ What’s Next?

1. Digital Rupee launch – SBP to announce specifics of pilot rollout and testing phases.

2. PVARA operationalization – Licensing processes and guidelines for VASPs to be published soon.

3. Policy rollout – Integration of crypto services across banking, compliance, and legal sectors.

4. Islamic oversight – Shariah Advisory Committee will standardize compliance for religiously compliant crypto offerings.