Pakistan Eyes Game-Changer: Rupee-Backed Stablecoin in the Works

Pakistan steps into the crypto arena with plans for a rupee-pegged stablecoin—because what’s more stable than a fiat currency in an emerging market?

The move could signal a shift toward digital finance—or just another government desperate to seem innovative while avoiding real monetary reform.

Active, liquid, and potentially volatile? Welcome to the future of Pakistan’s monetary policy.

Masud acknowledges the rapidly expanding global market for stablecoins

When asked by reporters why the country had shifted its interest towards the stablecoin market, Masud acknowledged the rapidly expanding global market for stablecoins. Based on his argument, Pakistan is carefully evaluating the creation of a stablecoin backed by the rupee.

Masud also noted that a Central Bank Digital Currency (CBDC) is important as it could enhance access to financial services and reduce remittance costs. 

Regarding his statement, Faisal Mazhar, Deputy Director of Payments at the State Bank of Pakistan, commented on the topic of discussion. Mazhar mentioned they have already begun developing a CBDC prototype with assistance from the International Monetary Fund (IMF) and the World Bank. Moreover, the deputy director revealed plans to conduct a pilot phase before fully launching the prototype.

In the meantime, it is worth noting that Pakistan’s project to develop its stablecoin comes shortly after a fintech startup, ZAR, announced its plan to offer dollar-backed stablecoins to the country’s everyday users. 

At the same time, other emerging markets secured $12.9 million in a funding round led by Andreessen Horowitz (a16z). Other investors backing this initiative include VanEck Ventures, Endeavour Catalyst, Coinbase Ventures and Dragonfly Capital.

Still, ZAR aims to embrace its intention to assist 240 million individuals in Pakistan, where over 100 million adults do not have bank accounts, by offering access to stablecoins and improving financial inclusion. 

Pakistan aims to solidify its position as a leader in the crypto ecosystem 

A reliable source recently highlighted that Pakistan gained six positions to secure the third spot in Chainalysis’ Global Crypto Adoption Index for 2025. This ranking solidifies the country’s position as a rapidly expanding crypto market worldwide. Local experts estimate that citizens hold between $20 billion and $30 billion in digital assets, mostly through peer-to-peer and informal channels.

Meanwhile, to strengthen its presence in the crypto market, Pakistan opened its doors to VIRTUAL asset service providers (VASPs) and international crypto exchanges in September this year. The country encouraged them to apply for licenses under a new federal regulatory system. 

On the other hand, the Pakistan Virtual Asset Regulatory Authority (PVARA) urged leading firms to submit Expressions of Interest (EoIs) to support the nation’s growing digital asset industry.

Established under the Virtual Assets Ordinance 2025, PVARA regulates, licenses, and oversees VASPs. The agency was assigned this role after a report from the local English news source Dawn mentioned that PVARA will carry out its operation as an independent regulator. 

Apart from the above role, PVARA was assigned the responsibility of making sure VASPs meet international standards and adhere to the Financial Action Task Force (FATF) guidelines. 

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