Islamabad – The Senate of Pakistan will soon review the Virtual Assets Bill 2025, introduced as a private member’s bill by Senator Dr. Afnan Ullah Khan. This legislation aims to regulate virtual assets like cryptocurrencies and blockchain technologies, while also preparing for the introduction of a Digital Rupee backed by the Pakistani Rupee (PKR).
Core Objectives of the Bill
The Virtual Assets Bill 2025 aims to:
- Regulate the issuance, trading, and use of virtual assets in Pakistan.
- Create Virtual Asset Zones to maintain financial stability, protect investors, and prevent illegal activities.
- Provide a legal framework to recognize the Digital Rupee as an authorized legal tender.
The bill also sets detailed guidelines for registering and licensing virtual currency exchanges, virtual asset providers, and virtual asset zones. Additionally, it mandates strict adherence to anti-money laundering (AML) and counter-terrorism financing (CTF) regulations.
National Virtual Assets Regulatory Commission
The proposed bill calls for establishing a National Virtual Assets Regulatory Commission to:
- Evaluate the risks and benefits of virtual assets.
- Develop legal and regulatory frameworks for managing virtual assets.
- Supervise the licensing and operations of virtual currency exchanges and service providers.
- Ensure compliance with AML/CTF standards.
- Audit and analyze virtual asset transactions to build trust and accountability.
Virtual Asset Zones
Both federal and provincial governments will designate areas as Virtual Asset Zones, focusing on regions with underutilized or surplus renewable energy. The commission will maintain a public register of licenses for these zones, including application statuses, enforcement actions, and revoked licenses.
Licensing and Compliance Requirements
Virtual currency exchanges and service providers must obtain licenses by:
- Providing proof of business registration and financial stability.
- Demonstrating compliance with AML/CTF regulations.
- Implementing strong cybersecurity measures.
Tax Incentives and Foreign Investment
To encourage growth in the virtual assets sector, the government will offer significant tax incentives:
- Reduced corporate taxes for Virtual Asset Zones during the first five years, contingent on AML/CTF compliance.
- Three-year tax exemptions for foreign investors contributing to blockchain projects or power plants.
- Allocation of one-third of revenue from virtual assets to local infrastructure and blockchain education programs.
Promoting Transparency and Accountability
To enhance transparency in the virtual currency market, the bill requires regular audits and reporting from entities involved in virtual asset management and trading. This initiative aims to build trust and ensure accountability within Pakistan’s financial system.
Next Steps
The Senate’s consideration of the Virtual Assets Bill 2025 is a significant move toward embracing blockchain technology and cryptocurrencies in Pakistan, ensuring regulatory oversight to protect investors and maintain financial stability.
