Pakistan explores tokenisation of existing Eurobond debt, says Aurangzeb

Pakistan is exploring the tokenisation of its existing Eurobond debt, said Finance Minister Muhammad Aurangzeb on Monday, while addressing the “Dialogue on Digital Assets and the Future of Banking”, organised by the Pakistan Banks’ Association (PBA) in collaboration with LUMS.

The finance minister shared that the government is holding discussions on the proposed initiative and is seeking Cabinet approval before proceeding with the issuance of a request for proposals (RFP).

“We are reviewing at this point from the Ministry of Finance and Government of Pakistan, is tokenization of our existing Eurobond debt. We are in discussions at this point, and we are looking forward to the Cabinet approval on this, before we move ahead with issuing the RFP on this front,” he said.

The initiative aims to explore the use of tokenisation in managing sovereign debt, potentially opening new avenues for digital financial transactions and investment.

Pakistan explores use of digital assets, tokenisation for real estate and investment assets

The minister urged banks to play an active role in developing practical proposals around digital financial technologies.

“You bring the customer relationships, operational experience and risk management capabilities that this work requires. Invest in the expertise to assess these technologies and work with relevant regulators on the activities permitted within your mandates and, of course, with the support of your respective boards.”

Pakistan has established a statutory framework for virtual assets under the Virtual Assets Act 2026, with the Pakistan Virtual Assets Regulatory Authority (PVARA) responsible for licensing and supervising virtual asset service providers.

The State Bank of Pakistan has also provided a conditional pathway for banks to offer services to PVARA-licensed businesses, subject to due diligence and segregation of client funds.

However, restrictions on banks investing, trading or holding virtual assets using their own funds or customer deposits remain in place, the minister said.

He stressed that digital financial innovation must be accompanied by appropriate safeguards, regulatory oversight and cybersecurity measures. “We all need to acknowledge that we are under attack 24/7 by state and non-state actors, and therefore there is no room for complacency.”