Pakistan is moving closer to launching a state-backed digital currency tied to the rupee, which would allow citizens to trade in digital assets. However, the initiative hinges on the approval of the Pakistan Virtual Assets Regulatory Authority (PVARA) Bill, amendments to the SBP Act, and the establishment of a comprehensive legal framework.
Appearing before the Senate Finance Committee, SBP Acting Deputy Governor Dr Inayat Hussain confirmed that digital assets would fall under the Foreign Exchange Regulation Act (FERA), including a cap of $100,000 per individual on outbound transactions annually. But legal experts from the Ministry of Law cautioned that FERA, in its current form, is difficult to enforce on digital transactions. “Some amendments will be needed,” said legal consultant Shehroz Bakhtiyar.
Lawmakers echoed these concerns, noting Pakistanis have invested over $21 billion in digital assets. Senator Afnanullah Khan emphasized the urgency of regulation, adding, “The gold standard should be the central bank digital currency.”
The SBP’s proposed digital currency will match the rupee’s value and be accessible through regular bank accounts. While PVARA will regulate digital service providers, it won’t oversee the central bank’s digital currency, which will fall under the SBP Act. Until the framework is finalized, existing restrictions on banks and dealers remain in place.
