By Waheed Basrli
Experts say Pakistan's nascent digital asset sector faces serious risks due to a lack of clear regulatory frameworks and inadequate investor protections.
During the SDPI conference, keynote speakers revealed that Pakistan has a potential trading volume of $300 billion in the digital asset market, but the country's GDP is only $400 billion, making this sector a huge economic opportunity for the developing nation.
However, Pakistan Bankers Association (PBA) President Zafar Masood emphasized that the delay in adopting a comprehensive legal framework could cost the country $25 billion in economic opportunities. In his speech, Masood called for a gradual and cautious approach to developing a regulatory ecosystem for service providers in the sector.
The official added that the proposed legislation should prioritize cybersecurity and consumer protection, with clear licensing requirements. Besides pushing for strict regulation, Massoud recommended the launch of a central bank digital currency (CBDC) to lower the costs of cross-border transfers.
Although he did not specify whether the digital currency would be for public use or for the financial sector only, he called for a "stablecoin pegged to the rupee" to be considered, citing the rapid growth of the global stablecoin industry and new regulations in the United States.
Singapore-based financial expert Yara Wu noted her preference for central bank-issued digital currencies, explaining that providing them with cross-border transfer capabilities would significantly reduce the high costs of remittances. Both Wu and Masood pointed out that central bank digital currencies, despite their benefits in promoting financial inclusion, may also face regulatory challenges and cyber risks.
Faisal Mazhar, deputy director of payments at the State Bank of Pakistan, revealed that the bank is working with the World Bank and the International Monetary Fund to launch a prototype of a national digital currency. He emphasized that pilot operational trials will be launched soon before full implementation, as part of the country's efforts to develop the payments environment.
Digital Transformation Breakthrough
Since the beginning of the year, Pakistan has made significant progress in its digital transformation. A central bank report showed that digital payments rose in the past 12 months to account for 88% of the country's total commercial transactions.
As transaction volumes rose, digital wallet services expanded to remote areas, driven by new government initiatives. In mid-2025, the country announced the establishment of a new regulatory body to oversee digital assets and opened the door for global trading platform operators to obtain official licenses.
In a move aimed at ending cash transactions, the government has signaled its intention to accelerate the transition to a cashless economy.
Prime Minister: The world is moving towards a digital economy and Pakistan must keep pace
Prime Minister Shahbaz Sharif reiterated his government's commitment to accelerate the transition to digital payments during a high-level meeting of regulators and the financial sector. Sharif said that moving to a cashless system improves governance and supports sustainable development.
The prime minister directed the launch of awareness campaigns in rural areas to familiarize residents with the benefits of digital transactions, stressing that the move will promote financial inclusion and economic resilience.
Sharif said: "The whole world is moving towards the digital economy, and Pakistan must move with it."
He revealed that financial transformation initiatives are starting to yield positive results, with new data showing that RAAST QR codes have facilitated billions of rupees in utility bill payments. The Benazir Income Support Program (BISP) has also increased the volume of digital payments.
The government has granted operating licenses to digital banks, which are expected to provide financial services to more than 70% of the population.
Representatives from the Ministries of Finance and Communications, the Central Bank, the National Identity Authority (NADRA), and the Tax Authority (FBR) gave briefings on the integration of government service applications with RAAST tokens. Sharif expressed his satisfaction with the progress made, calling on all organizations to adhere to timelines to achieve digital transformation goals in light of accelerated regional competition.
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