Pakistan’s Senate committee has raised concerns over the Virtual Assets Bill 2025, warning of crypto misuse in crime, hawala channels, and tax evasion, while urging strict oversight and transparency.
Senators warn of crypto misuse
Pakistan’s Senate Standing Committee on Finance has raised sharp concerns over the country’s proposed Virtual Assets Bill 2025, focusing on regulation, taxation and the dangers of cryptocurrency misuse.
Chaired by Senator Saleem Mandviwalla, the committee met this week to deliberate on the landmark legislation, which aims to introduce oversight of Pakistan’s rapidly expanding digital asset sector.
Senator Mandviwalla cautioned that the majority of cryptocurrency transactions in Pakistan are being conducted through hawala and hundi systems — informal money transfer methods that are illegal. “This makes it imperative to introduce oversight mechanisms to prevent misuse,” he said, stressing that Pakistan ranks eighth globally in terms of crypto investment.
Criminal use of digital assets under scrutiny
Senator Mohsin Aziz raised alarm over growing criminal use of virtual assets. “I have learned that people no longer demand cash; they demand payments in crypto,” he said, citing reports of kidnapping-for-ransom cases where digital currencies have replaced traditional demands for money.
The State Bank of Pakistan (SBP) confirmed that cryptocurrencies currently exist in a “grey area” legally. SBP’s Deputy Governor acknowledged the technical skills of Pakistan’s youth in crypto trading but warned of the risks posed by unregulated dealings.
Proposal for independent oversight board
The Ministry of Law told the committee that the bill includes provisions for an independent oversight board, staffed with experts in finance, technology and regulation, to monitor virtual asset activity.
However, Senator Mandviwalla insisted that the eligibility criteria for such board members should be clearly defined in the bill itself, rather than left to be outlined in secondary regulations.
Finance Secretary Imdadullah Bosal said the absence of any regulatory framework for virtual assets had left a dangerous vacuum. He added that the bill seeks to provide transparency, monitor potential money laundering activities, and bring Pakistan in line with international compliance standards.
Taxation debate emerges
Senator Dilawar Khan steered the conversation towards taxation, suggesting that a uniform 5 per cent tax rate on crypto assets could improve compliance and generate significant revenue for the government.
At present, the taxation of crypto assets remains unclear, with trading largely taking place outside the formal financial system. Senators agreed that a clearly defined tax structure would be essential to both regulation and revenue generation.
A cautious but pressing reform
While Pakistan remains one of the fastest-growing crypto markets, the Senate’s debate highlights the challenges of balancing innovation with national security and financial stability. From criminal misuse to taxation gaps, lawmakers signalled that the Virtual Assets Bill 2025 must provide robust oversight if Pakistan is to safely integrate digital assets into its economy.
