Pakistan gained great popularity in 2025, and the cryptosphere set its eyes on the country when the government announced the launch of the Pakistan Virtual Assets Regulatory Authority (PVARA). Shortly after, No Objection Certificates (NOC) were promptly issued to Binance and HTX, two of the largest exchanges to operate globally.
Pakistan takes the third spot in the 2025 global crypto adoption index as reported by Chainalysis; the Asia-Pacific region grew its crypto transactions from $1.4 trillion to $2.36tr, led by Vietnam, India & Pakistan.
Once PVARA issued the NOC, a Memorandum of Understanding was signed with Binance that would explore the potential tokenisation of $2 billion worth of bonds, treasury bills and commodity reserves. But what is tokenisation?
Tokenisation relies on blockchain technology to record ownership of an asset. The asset class represented by the token can be financial assets (the case which Pakistan is pursuing with Binance), or they can be physical assets such as real estate, gold, silver, commodities, utilities, etc, which are also known as real-world assets (RWA).
Tokenisation of assets unlocks multiple benefits; it is seen as a solution to the friction in real-world asset markets.
The virtual asset framework presents a unique opportunity to inject capital into the country and provide citizens with an opportunity to invest in its functional asset class
Firstly, the liquidity of traditionally illiquid assets is enhanced — think of a real estate plot, in the current system that only an individual buyer with sufficient cash at their disposal would be able to purchase fully, but through tokenisation, multiple people can own that plot of land proportionate to their share represented by tokens, this creates liquidity and ease of ownership for everyone.
Secondly, tokenisation is usually on a public blockchain, making the underlying asset easily accessible to anyone globally; this bypasses the usual friction of cross-border settlement and custody. In the case scenario of a plot, buyers from different regions can own the plot and easily settle the dues for it through blockchain technology.
Thirdly, blockchain technology embodies more transparency than the traditional ownership methods; the ‘chain of ownership’ in blockchain is publicly available and only transfers if the previous chain link is valid, meaning there can be no tampering of any nature.
The ownership or the existence of the plot of land cannot be forged in any way or manner once it is properly vetted and authorised for tokenisation by the relevant regulators. Paul Atkins, the Securities and Exchange Commissioner of the United States, stated that public blockchains are more transparent than any financial system ever built.
In order to tokenise assets, a regulatory framework is required to be in place, which oversees all the compliance requirements of tokenisation of real-world assets as well as virtual assets. Multiple jurisdictions have different regulatory regimes, but noticeably, the most advanced ones involve Distributed Ledger Technology (DLT).
A DLT framework provides a purpose-built framework for entities operating in blockchain ecosystems, enabling transparent governance, digital asset management, utility-token-based operations and decentralised decision-making.
Some of the major jurisdictions which have adopted DLT frameworks are; Switzerland through its DLT Act which recognises tokenised securities; Singapore through its Monetary Authority of Singapore; European Union through its MiCA regulation; and Hong Kong’s Monetary Authority (HKMA). The United Arab Emirates also has the ADGM regime in place to run DLT Foundations (which is for nonprofit programmes).
The functionality of tokenisation in most of these jurisdictions is reliant upon the issuance of stablecoins or central bank digital currency (CBDC), which is a form of a digital token either backed by a fiat currency or representing a fiat currency. It’s a method of instant transaction settlement locally and globally. Pakistan has also expressed interest in issuing stablecoins.
Once an asset is tokenised, the people who invest in it receive ‘tokens’ representing the asset class, which are proportionate to the value they have invested, and as the asset class increases in value, the value of those tokens increases as well. Some assets, such as real estate, also produce rental yield, benefiting the token holders.
Although Pakistan carries an abundance of RWA’s and resources, such as agricultural crops including wheat, cotton, rice, sugarcane, maize, fruits and vegetables, energy materials such as coal, uranium, copper, gold, lithium, limestone, marble, rock salt etc, the country always finds itself relying on foreign governments or entities to save itself from economic perils.
To further add to the burden, most of the domestic investment practice in Pakistan is limited to either real estate, stocks or bonds.
With the global shift in investment methodology, blockchain technology opened the floodgates for investments, and various countries have tokenised their coal mines, gold reserves, and real estate properties, generating a profitable yield for the investors and creating expansion opportunities for the asset owners.
This presents Pakistan with a unique opportunity to inject capital into the country and provide everyone with an opportunity to invest in its functional asset class.
This opportunity can potentially lead to an investment boost into the country and create a sustainable platform for local and foreign investors.
The regulators can build investor confidence by setting up a reliable, efficient and transparent structure. The injection of capital would ultimately diminish the reliance of foreign entities on the survival of Pakistan’s economy.
The foundations of the virtual asset framework have been laid in Pakistan. The issuance of NOC for Binance and HTX has stimulated global interest. Now, if the regulators could keep developing it by incorporating stablecoins or CBDC and developing a DLT framework as well, the economic boom through virtual asset adoption can be exponential and a potential lifeline for the fragile economy of Pakistan.
The writer is a Pakistani-origin lawyer currently working in Dubai as a legal manager for a FinTech company, managing all the regulatory and compliance requirements.
Published in Dawn, The Business and Finance Weekly, December 22nd, 2025