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Pakistan opens a regulated sandbox for asset-backed tokens, requiring strict asset backing and clear exit plans to balance innovation with financial safeguards.
Read more: PVARA Launches Regulatory Sandbox For Virtual Assets
Pakistan Virtual Assets Regulatory Authority has introduced new sandbox guidelines and invited applications for the initial rollout of asset-referenced tokens under the Virtual Assets Act, 2026.
These tokens, a category of stablecoins, are described as digital assets that reflect ownership, claims, or financial interests linked to underlying assets. The regulator emphasised that such tokens must be “fully backed by the underlying assets” and cannot depend on other virtual assets for their value. Instead, they may be tied to physical or financial assets such as commodities, property, or currencies.
The framework also defines fiat-referenced tokens as digital assets designed to hold a steady value against a single national currency and be redeemable at face value.
The guidelines outline who can apply, how the process works, and the criteria for evaluation. A key requirement is for applicants to present an exit plan, explaining how they would “wind down if unsuccessful or transition to licensing if successful.”
The initiative reflects Pakistan’s effort to regulate innovation while maintaining safeguards in its growing digital asset space.
