Senate Committee Raises Concerns Regarding Virtual Assets Bill 2025

The Senate Standing Committee on Finance, chaired by Senator Saleem Mandviwalla, convened to deliberate on the Virtual Assets Bill 2025, with a primary focus on the regulation, taxation, and potential misuse of cryptocurrencies in Pakistan. Committee Chairman Senator Mandviwalla raised concerns that most cryptocurrency transactions in Pakistan are currently conducted through hawala and hundi channels, which are illegal. He emphasized the urgency of regulation, noting that Pakistan ranks 8th globally in crypto investment. “This makes it imperative to introduce oversight mechanisms to prevent misuse,” he said. Senator Mohsin Aziz expressed alarm over reports that cryptocurrencies are being used in kidnapping-for-ransom cases in Pakistan. “I have learned that people no longer demand cash; they demand payments in crypto,” he stated, highlighting the growing risks of unregulated virtual assets. Representatives from the State Bank of Pakistan (SBP) confirmed that while crypto currently exists in a “grey area” legally, the central bank has already issued advisories. SBP’s Deputy Governor noted that Pakistani youth are highly skilled in crypto trading but stressed the dangers of unregulated dealings. The Ministry of Law added that the bill proposes establishing an independent board to oversee virtual assets, comprising experts in technology, finance, and regulatory affairs. Chairman Mandviwalla insisted that eligibility criteria for board members should be explicitly included in the legislation, rather than left to subsequent rules. Finance Secretary Imdadullah Bosal informed the committee that there had previously been no regulations governing virtual assets, but the government is now introducing transparency and oversight mechanisms. He also stated that the bill will assess whether virtual assets are being used for money laundering. Senator Dilawar Khan shifted the discussion to taxation, suggesting that a uniform 5% tax rate on virtual assets could increase compliance and revenue. “If we reduce current tax rates, overall tax collection could rise by 40%,” he argued, cautioning against new tax experiments that could destabilize the economy. Senator Anusha Rahman criticized the performance of customs authorities, citing complaints of 23 checkpoints between Quetta and Taftan, where traders reportedly pay bribes to move goods. She questioned whether the proposed law would help reduce or exacerbate money laundering. The meeting concluded with a consensus that while virtual assets present significant economic opportunities, they also pose serious risks of money laundering, illegal transfers, and criminal misuse. The committee stressed the need for balanced and robust regulation to address these challenges effectively.