Pakistan has the potential to emerge as a leader in the cryptocurrency space within the next five years, according to former Binance CEO Changpeng Zhao. This optimistic outlook stems from the country's swift adoption of crypto-related technologies and the government's increasing interest in regulating the sector.
In early 2025, the government demonstrated a proactive approach by establishing the Pakistan Crypto Council (PCC) to integrate blockchain technology into the financial system. This council aims to create a clear regulatory framework for digital assets, safeguard investors, and prevent illicit activities such as money laundering. The appointment of Changpeng Zhao as a strategic advisor to the PCC further underscores Pakistan's commitment to fostering a thriving crypto ecosystem. Zhao's expertise is expected to guide the country in critical areas such as regulation, infrastructure development, education, and overall adoption.
Pakistan has been actively taking steps to regulate cryptocurrencies and digital assets. The Virtual Assets Ordinance, 2025, which came into effect on July 8, 2025, provides a legal framework for regulating virtual assets and providers. This ordinance led to the creation of the Pakistan Virtual Asset Regulatory Authority (PVARA), tasked with monitoring all crypto-related activities, licensing crypto entities, and ensuring consumer protection. The PVARA held its inaugural meeting in August 2025.
The government is exploring digital finance and crypto regulation to channel investment towards climate resilience and sustainable projects. Finance Minister Muhammad Aurangzeb has emphasized the potential of digital finance to mobilize sustainable capital and has highlighted Pakistan's climate frameworks, including the National Adaptation Plan and the National Climate Finance Strategy.
Despite these advancements, cryptocurrency transactions are currently considered illegal in Pakistan, with the State Bank of Pakistan (SBP) maintaining a ban reinforced by a 2024 directive. The SBP's Financial Monitoring Unit actively refers crypto-related cases to law enforcement agencies. However, the recent government initiatives, including the formation of the Pakistan Crypto Council and the introduction of the Virtual Assets Ordinance, signal a potential shift towards a more regulated and accepting environment for cryptocurrencies. The ordinance was presented before the Senate on August 15, 2025, and in the National Assembly on September 5, 2025, and is currently under review by the Finance and Revenue Committees of both houses.
Pakistan's large population, with a significant percentage under the age of 30, represents a substantial potential user base for cryptocurrencies. The country's high ranking in global crypto adoption indices demonstrates a strong appetite for alternative investments and digital finance among its citizens. By implementing comprehensive regulations, promoting education, and fostering innovation, Pakistan can leverage its demographic advantage and become a prominent player in the global crypto landscape.
However, for Pakistan to truly realize its potential as a crypto leader, it needs to establish comprehensive cross-sector regulations and promote multi-sector collaboration. This involves not only creating a legal framework for virtual assets but also ensuring that these regulations align with global standards and best practices. Additionally, educating the public about the benefits and risks of cryptocurrencies is crucial for fostering trust and encouraging responsible adoption.
