Pakistan eyes Eurobond tokenization, awaits cabinet approval

November 02, 2026 (MLN): Pakistan is reviewing the tokenization of its existing Eurobond debt, with the proposal awaiting cabinet approval before a Request for Proposal (RFP) is issued, Finance Minister Muhammad Aurangzeb said while addressing a Pakistan Banks Association dialogue on digital assets and the future of banking.

The government is also looking at tokenization use cases for Roshan Digital Accounts and remittances. Muhammad Aurangzeb said remittances closed last fiscal year at $41.6 billion and, going by the first quarter of the current fiscal year, could cross $44 billion this year.

The minister said digital assets should earn their place in the financial system by lowering the cost of doing business and bringing more people into the formal economy.

He said the test is whether a family can receive money from abroad at a lower cost, whether a business can get paid sooner, and whether an entrepreneur can obtain financing on reasonable terms, while financial stability is protected.

Muhammad Aurangzeb said Pakistan has moved from prohibition and regulatory ambiguity to a statutory supervised pathway through the Virtual Assets Act 2026, with P-VARA responsible for licensing and supervising virtual asset service providers.

He said this was achieved in months, not years, and that the task now is to make the framework effective through capable supervision and clear coordination among institutions. He also acknowledged the roles of the State Bank of Pakistan (SBP) and the Securities and Exchange Commission of Pakistan (SECP).

On banking access, he said the SBP has provided a conditional route for banking services to P-VARA licensed businesses, with requirements for due diligence and segregation of client funds. Accounts for NOC holders have a more limited purpose while licensing formalities are completed.

Banks remain responsible for compliance with FX rules, and the restrictions on banks investing, trading or holding virtual assets using their own funds or customer deposits remain in place.

The minister said regulation must reflect the differences between products. A tokenized bank deposit remains a claim on a bank, a stablecoin’s risks depend on its issuer, backing and redemption arrangements, and an unbacked crypto asset carries a different set of risks.

On the international front, Muhammad Aurangzeb said Pakistan, through its Permanent Mission to the UN and P-VARA’s chairman, co-convened a dialogue on blockchain and the tokenized future with the UN Office for Digital and Emerging Technologies in late September in New York. He said Pakistan’s assumption of the G24 chairmanship can help shape the dialogue for the Global South.

He pointed to JP Morgan’s use of deposit tokens for institutional clients and the Bank for International Settlements’ Project Agora, which is testing tokenized commercial bank deposits and central bank reserves for cross-border settlement, as examples of banks’ critical role.

Muhammad Aurangzeb urged banks to develop practical proposals, invest in expertise to assess the technologies, and work with regulators on activities permitted within their mandates.

On cybersecurity, he said there is no room for complacency as the financial system is under attack 24/7 by state and non-state actors.

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