Regulating Digital Finance: A Critical Analysis of Pakistan’s Virtual Assets Ordinance 2025

Mian Zafar Iqbal Kalanauri

doi:10.54692/ijeci.2025.0901/250

Mian Zafar Iqbal Kalanauri Arbitrator Fellow CIArb, Barrister Mediator CEDAR, IMI, CMC, U.S.A., Master Trainer Mediation CEDAR, Legal Educator Reformist of Judicial System and Legal Education, White Collar Crime Investigator

DOI: https://doi.org/10.54692/ijeci.2025.0901/250

Keywords: Central Bank Digital Currency, Markets in Crypto-Assets Regulation, Ordinance, Criminal Culpability, Shariah Compliance, Legislative Permanency

Abstract

The Virtual Assets Ordinance 2025 of Pakistan, which establishes a legislative framework for virtual assets, crypto service providers, and a Central Bank Digital Currency (CBDC) pilot, is examined critically in this article. It assesses the scope, governance, sandbox design, and licensing system of the Ordinance, emphasizing jurisdictional overlaps, enforcement ambiguities, and the separation of civil and criminal culpability. Comparisons with the United Arab Emirates, Singapore, India, and the European Union's Markets in Crypto-Assets Regulation (MiCA) highlight Pakistan's regulatory strengths and weaknesses, especially with regard to Shariah compliance. The article argues that the Ordinance runs the risk of restricting innovation and creating legal uncertainty if it is not refined. It ends with recommendations for legislative permanency, institutional capacity-building, and a tiered licensing approach.