Pakistan is making moves to ramp up its digital assets ambitions by signing a memorandum of understanding (MoU) with crypto exchange Binance. According to the terms of the deal, the crypto exchange will provide advice for the country as it prepares to explore tokenizing up to $2 billion in state-owned assets.
This latest development comes amid Pakistan’s move to introduce regulations to its crypto industry, which is expected to pave the way for its national stablecoin plans. The agreement, which was announced by the country’s finance ministry, sets the stage for Binance to provide its expertise on blockchain-based distribution of Pakistan’s sovereign bonds, treasury bills, and commodity reserves, including gas, metals, and commodities, according to Reuters.
Pakistan taps Binance for advice on tokenization plans
According to Pakistani Finance Minister Muhammed Aurangzeb, the MoU is a signal of the country’s reform trajectory and a step towards a long-term partnership with the crypto exchange. He mentioned that the next step will involve the execution, which the country is fully focused on. As a result of that, Pakistan is expected to deliver results with speed and quality in the shortest possible time frame.
Binance founder Changpeng Zhao is no stranger to Pakistan, as he serves as a strategic advisor to the Pakistan Crypto Council. In a statement, Zhao mentioned that the agreement was a great sign for the global blockchain industry. He also added that for Pakistan, the agreement is expected to serve as the beginning of a move towards full deployment of the tokenization plan. The Binance MoU is non-binding and requires definitive agreements within six months. It is also subject to regulatory approvals.
Aside from the MoU, Pakistan’s regulator has granted a preliminary clearance to Binance and HTX to begin local licensing. Both exchanges were awarded the No Objection Certificate, which allows them to register with the country’s Anti-Money Laundering system and prepare for full license applications. “This phased approach allows us to begin providing AML-registered cross-border services to Pakistani users while we continue working closely with PVARA toward full authorization,” Binance said in a statement.
Moves to set up its crypto industry are underway
Binance also mentioned that it is in line with its regulatory roadmap, a move that reflects its long-term commitment to supporting the country’s digital economy. Meanwhile, the certificates do not necessarily mean the chosen exchanges are permitted to operate. The clearance comes after the regulator, the Pakistan Virtual Assets Regulatory Authority (PVARA), called on exchanges to register for local licenses in September.
Pakistan currently ranks as the world’s third-largest market by retail activity, according to PVARA Chairman Bilal Bin Saqib, who noted an estimated 40 million users and annual trading volume that surpasses $300 billion. The country has also discussed the need for regulation, as noted at a high-level meeting attended by senior officials from the country and representatives from the crypto exchange Binance. The government says it wants to create a transparent and secure framework for digital assets.
The MoU also follows comments made by Bin Saqib earlier this month, confirming that the country will definitely launch its stablecoin. Bin Saqib claimed launching the stablecoin will provide the government with a better way to collate rising debt, noting that Pakistan is also trying to develop a central bank digital currency pilot. “We want to be at the forefront of this financial digital innovation that is happening,” Saqib said. “Why should we be at the tail-end of it when we have the muscle and the adoption?”
Pakistan has been proactive in terms of setting up its crypto industry. Since the start of the year, the country has established the Pakistan Crypto Council and PVARA. In April, the Council and the Trump-backed World Liberty Financial signed a letter of intent to explore stablecoin infrastructure and real-world asset tokenization. The following month, the country announced the allocation of 2,000 megawatts of electricity for Bitcoin mining and AI data centers.
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Source: https://www.cryptopolitan.com/pakistan-binance-2-billion-tokenization/
