As per the new ordinance, the government has created the Pakistan Virtual Asset Regulatory Authority (PVARA), a specialized agency responsible for regulating and managing the virtual asset business environment in Pakistan.

Among the ordinance s most prominent features is the institution of a licensing regime for Virtual Asset Service Providers (VASPs). This is to say that any business or platform engaged in cryptocurrencies or other digital assets must now acquire official permission to do so. The regulatory structure has been built to bring best practices globally, including adherence to the Financial Action Task Force (FATF) guidelines.

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The purpose is to rein in the abuse of virtual assets in activities like money laundering and financing of terrorism, which have tended to be problems found with uncontrolled crypto transactions.

The ordinance was issued on July 8 pursuant to Article 89 of the Constitution, at a time when the Parliament was not sitting. As an ordinance, it shall hold for a period of 120 days, unless enacted into law by Parliament.

To begin with, there was some ambiguity when the ordinance was mistakenly called an "Act." But then again, authorities have made it clear that it is still a temporary ordinance until it gets full legislative sanction.