Pakistan Weighs Rupee-Backed Stablecoin Amid $25 Billion Crypto Growth Potential

Pakistan is actively exploring the launch of a rupee-backed stablecoin and a central bank digital currency (CBDC), as policymakers and industry leaders warn that delays in regulating digital assets could cost the nation up to $25 billion in missed economic opportunities.

Speaking at the Sustainable Development Policy Institute (SDPI) Conference, Pakistan Banks Association (PBA) President Zafar Masud emphasized the vast potential of the country’s crypto sector. Highlighting the rapid expansion of global stablecoin markets, Masud said Pakistan is “seriously considering a rupee-backed stablecoin” and believes a CBDC could boost financial inclusion while reducing remittance costs for the nation’s large diaspora community.

Faisal Mazhar, Deputy Director of Payments at the State Bank of Pakistan, confirmed that a CBDC prototype is already under development with technical assistance from the World Bank and International Monetary Fund (IMF). A pilot phase is expected before the proposed digital currency is rolled out to the public.

This surge of digital asset innovation comes alongside growing private-sector activity. ZAR, a fintech startup focused on bringing dollar-backed stablecoins to Pakistan and other emerging markets, recently raised $12.9 million in a funding round led by Andreessen Horowitz (a16z). Other investors include Dragonfly Capital, VanEck Ventures, Coinbase Ventures, and Endeavor Catalyst.

Targeting Pakistan’s 240 million citizens, more than 100 million of whom remain unbanked, ZAR aims to bridge financial inclusion gaps by offering accessible, blockchain-based financial services powered by stablecoins.

Regulation and Global Standing

Pakistan’s crypto ambitions are supported by its strong global position. According to the 2025 Chainalysis Global Crypto Adoption Index, the country now ranks third worldwide, cementing its status as one of the world’s fastest-growing digital asset markets.

To harness this momentum, the government has recently opened its doors to international crypto exchanges and virtual asset service providers (VASPs). In September, the Pakistan Virtual Asset Regulatory Authority (PVARA) — established under the Virtual Assets Ordinance 2025 — invited global crypto firms to apply for licenses and participate in shaping the country’s evolving digital asset landscape.

PVARA has been tasked with licensing, regulating, and supervising VASPs, ensuring compliance and fostering trust as Pakistan positions itself at the forefront of responsible crypto innovation across emerging markets.