Digital Rupee Push: Pakistan Fast-Tracks Stablecoin and CBDC to Capture $25 Billion Crypto Opportunity
It feels like a race to the finish as Pakistan makes its foray into digital finance with an active consideration of a rupee-backed stablecoin and development of a Central Bank Digital Currency prototype. The move seems quite deliberate to advance financial inclusion for the largely unbanked population of the country. In fact, experts warn that delay in regulation may cost the country a potential $25 billion in crypto-related economic opportunities.
Regulation Key to Unlocking $25 Billion Potential
The financial leadership of the country is spearheading the move to formalize the virtual asset sector. Alluding to the potential of the country to tap into $20–25 billion in crypto-related gains if it acts early, the President of the Pakistan Banks Association, Zafar Masud, emphasized strongly that this should be done with the requisite regulatory safeguards and consumer protection measures in place. Mr. Masud also disclosed that “seriously considering a rupee stablecoin” is underway for Pakistan en route to its digital transition, but warned that cybersecurity and addressing negative public perception remain formidable barriers ahead.
The need for regulation is also emphasized by the fact that crypto investments at present are unmeasured, as Pakistan does not have any legal framework for documenting virtual asset activity. Independent experts say delaying the adoption of modern digital financial systems risks the country getting left behind in the next wave of global fintech trends. Besides, this would greatly reduce remittance costs and enhance financial access to people.
State Bank Progress and New Regulatory Body
Active work on the prototype of a digital currency has been in full swing since 2022 at SBP. The officials further noted that this development is also being supported by international financial institutions, including the World Bank and the IMF, and a pilot phase will follow after initial testing. This parallel effort, alongside the consideration of a stablecoin, reflects a dual approach toward digitizing the national currency.
Recently, Pakistan invited global crypto firms to apply for Virtual Asset Service Licenses. In a key stride toward the creation of a safe and regulated ecosystem, this call for Expressions of Interest has come from the newly established Pakistan Virtual Asset Regulatory Authority, PVARA, which was set up under the Virtual Assets Ordinance 2025 in September 2025. In fact, it was meant to align virtual asset sectors in Pakistan with international standards on anti-money laundering and counter-terrorism financing. Hence, the move will surely offer a sound basis for future fintech innovation.
This strategic move to introduce its own stablecoin comes at a time when ZAR, a fintech startup, has just raised $12.9 million in funding led by leading venture capital firm Andreessen Horowitz’s a16z. Other key investors include Dragonfly Capital, Coinbase Ventures, and VanEck Ventures. ZAR is committed to making dollar-backed stablecoins available for regular people in developing markets and has targeted Pakistan’s population of 240 million, more than 100 million of whom are unbanked adults. Hence, even private players are already doing their bit to achieve financial inclusion through access to stablecoins, thereby supplementing the central bank’s efforts internally. This will eventually mean that Pakistan is committed to developing a safe, inclusive, and innovation-friendly digital financial ecosystem