Islamabad – The Senate of Pakistan is set to deliberate on the Virtual Assets Bill 2025, introduced as a private member’s bill by Senator Dr. Afnan Ullah Khan. The proposed legislation aims to regulate virtual assets, including cryptocurrencies and blockchain-based technologies, while also paving the way for the introduction of a Digital Rupee backed by the Pakistani Rupee (PKR).
Key Objectives of the Bill
The Virtual Assets Bill 2025 seeks to:
- Regulate the issuance, trading, and utilization of virtual assets in Pakistan.
- Establish Virtual Asset Zones to ensure financial stability, protect investors, and deter illegal activities.
- Provide a legal framework for the recognition of the Digital Rupee as authorized legal tender.
Additionally, the bill outlines comprehensive guidelines for the registration and licensing of virtual currency exchanges, virtual asset providers, and virtual asset zones, while mandating strict compliance with anti-money laundering (AML) and counterterrorism financing (CTF) regulations.
National Virtual Assets Regulatory Commission
If enacted, the bill proposes the establishment of a National Virtual Assets Regulatory Commission to:
- Assess the risks and benefits of virtual assets.
- Develop legal and regulatory frameworks for managing virtual assets.
- Oversee licensing and operations of virtual currency exchanges and service providers.
- Monitor compliance with AML/CTF standards.
- Audit and analyze virtual asset transactions to foster trust and accountability.
Virtual Asset Zones
The federal and provincial governments will designate specific regions as Virtual Asset Zones, prioritizing areas with underutilized or surplus renewable energy capacity. The commission will maintain a public register of licenses for these zones, including application statuses, enforcement actions, and revoked licenses.
Licensing and Compliance Requirements
The bill mandates that virtual currency exchanges and service providers acquire licenses by:
- Providing evidence of business registration and financial stability.
- Demonstrating adherence to AML/CTF regulations.
- Implementing robust cybersecurity measures.
Tax Incentives and Foreign Investment
The government plans to offer significant tax incentives to promote growth in the virtual assets sector:
- Reduced corporate taxes for Virtual Asset Zones during their initial five years, contingent on AML/CTF compliance.
- Tax exemptions for three years to foreign investors contributing to blockchain projects or power plants.
- Allocation of one-third of revenue generated 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 approach aims to build trust and ensure accountability within Pakistan’s financial system.
Next Steps
The Senate’s consideration of the Virtual Assets Bill 2025 marks a significant step toward embracing blockchain technology and cryptocurrencies in Pakistan, while ensuring regulatory oversight to protect investors and maintain financial stability.
