Pakistan is on track to complete the pilot phase for its central bank digital currency (CBDC) by the end of the current fiscal year, concluding in June 2026. The announcement, made by Noor Ahmed of the State Bank of Pakistan (SBP), signifies a strategic move by the country to adopt blockchain-powered financial systems and exert regulatory control over the expanding virtual asset market.
This development comes shortly after the government formalized the Pakistan Virtual Assets Regulatory Authority (PVARA) through a presidential ordinance. The newly established body will be responsible for regulating the virtual assets sector, including cryptocurrencies, to ensure transparency, curb financial crimes such as money laundering and terror financing, and encourage responsible innovation within the space.
The central bank has not yet disclosed its technology partner or further implementation details, but officials maintain that announcements will be made in due time. Analysts believe that the central bank’s digital currency could become a payment option for existing bank account holders and digital payment users once the infrastructure is in place, though widespread merchant acceptance remains a challenge at this early stage.
The pilot aligns with broader efforts by the Pakistani government to formalize digital assets and expand the tax base. Financial experts estimate that bringing crypto into the regulatory net could uncover approximately $25 billion in virtual assets, a substantial contribution to the national economy. Pakistan, which exited the Financial Action Task Force’s grey list in 2022, has been under international pressure to enhance financial governance.
The formation of regulatory bodies such as the PVARA and the Pakistan Crypto Council (PCC), launched earlier this year, signals a shift in policy direction. These institutions are designed to provide legal cover to crypto investors and companies, and to offer a structured path for virtual asset adoption.
Industry professionals, including Farrukh H. Khan of Jazz and Farhan Hassan of easypaisa Digital Bank, have welcomed the cautious yet firm steps toward a regulated crypto ecosystem. According to Hassan, the establishment of PVARA provides the clarity needed for broader crypto and blockchain adoption in Pakistan. Easypaisa, with over 50 million users, is poised to play a major role in this transition by collaborating with regulators and shaping locally tailored fintech solutions.
Retail investors such as Muhammad Huzaifa, who manages crypto accounts valued between $50,000 and $100,000, see this legal framework as a long-awaited safeguard against institutional overreach, such as account freezes by agencies like the FIA. For many in Pakistan’s active crypto trading community, the move brings a new sense of security and legitimacy.
However, challenges persist. Experts warn that regulatory institutions may not yet have the technical capability to fully monitor fast-evolving crypto markets in real time. Muhammad Waqas Ghani of JS Global Capital cautions that while the initiative is ambitious, Pakistan’s stock exchange remains a more secure and regulated investment avenue in the near term.
The plan may also intersect with international financial obligations. The International Monetary Fund has flagged the need for equitable policy structures if the government considers subsidizing electricity for crypto mining and AI data centers. Any such move would require IMF engagement to ensure alignment with economic reform measures.
As the country follows global examples like India, which introduced an e-rupee pilot in 2022, Pakistan’s digital currency initiative is emerging as a key element in its digital financial future. While further legislative steps are awaited, the groundwork laid by SBP and PVARA marks a significant stride toward integrating virtual assets into Pakistan’s formal economy.
