Pakistan Explores Rupee-Backed Stablecoin Amid $25 Billion Economic Opportunity

Pakistan is actively considering the launch of a rupee-backed stablecoin, with policymakers warning that delays in digital asset regulation could cost the country up to $25 billion in lost economic opportunities. This proposal was discussed at the Sustainable Development Policy Institute (SDPI) Conference, where Zafar Masud, president of the Pakistan Banks Association (PBA), emphasized that establishing a clear regulatory framework could unlock between $20 billion and $25 billion in crypto-related growth.

Masud described the global stablecoin market as a "booming opportunity" and confirmed that Pakistan is "seriously considering a rupee-backed stablecoin." He added that a Central Bank Digital Currency (CBDC) could reduce remittance costs and improve access to financial services, crucial for a country where overseas remittances reached $29 billion in fiscal 2024.

Faisal Mazhar, deputy director of payments at the State Bank of Pakistan, revealed that a CBDC prototype is already under development with support from the World Bank and International Monetary Fund (IMF), with a pilot phase planned before a full rollout. This initiative aims to modernize the payments system and reduce dependence on foreign currency transactions.

In the private sector, fintech firm ZAR raised $12.9 million in a funding round led by Andreessen Horowitz (a16z), with participation from Dragonfly Capital, VanEck Ventures, Coinbase Ventures, and Endeavor Catalyst. ZAR targets Pakistan's population of 240 million, where over 100 million adults remain unbanked, by offering dollar-backed stablecoins as a faster, cheaper alternative to traditional remittances.

Pakistan climbed six places to rank third globally in Chainalysis' 2025 Global Crypto Adoption Index, reflecting rising retail use of digital assets. To formalize regulation, the government invited international exchanges and virtual asset service providers (VASPs) to apply for licenses under the Pakistan Virtual Asset Regulatory Authority (PVARA), established under the Virtual Assets Ordinance 2025, aiming to attract foreign investment while ensuring anti-money-laundering compliance.