Pakistan Moves Toward Digital Dollars as USD1 Stablecoin Deal Signals Shift in Cross-Border Payments

Pakistan has taken a notable step toward integrating dollar-backed digital assets into its financial system, signing an agreement to explore the use of the USD1 stablecoin for cross-border payments. The deal, announced on Wednesday, links Islamabad with SC Financial Technologies, a firm affiliated with World Liberty Financial, the crypto venture tied to the family of U.S. President Donald Trump.

The memorandum of understanding was confirmed by Pakistan’s Virtual Asset Regulatory Authority and centers on studying how USD1 could operate within a regulated digital payments framework. Officials described the agreement as a mechanism to foster “dialogue and technical understanding around emerging digital payment architectures,” rather than an immediate rollout. Still, it marks one of the first publicly disclosed collaborations between World Liberty’s ecosystem and a sovereign state.

Under the agreement, SC Financial Technologies will work alongside Pakistan’s central bank to explore integrating USD1 into the country’s evolving digital currency infrastructure. According to a source involved in the discussions, the goal is to allow the dollar-pegged token to function in parallel with Pakistan’s own digital initiatives, particularly for cross-border transactions such as remittances.

The announcement coincided with a visit to Islamabad by Zach Witkoff, co-founder and chief executive of World Liberty Financial and CEO of SC Financial Technologies. Witkoff, the son of U.S. special envoy Steve Witkoff, attended the signing alongside Pakistan’s Finance Minister Muhammad Aurangzeb. A government-released photograph showed Prime Minister Shehbaz Sharif and army chief General Asim Munir present at the ceremony, underscoring the political weight attached to the agreement.

Finance Minister Aurangzeb framed the move as part of a broader effort to modernize Pakistan’s financial system without undermining stability. He said the government’s priority was to engage with “credible global players” while ensuring that any experimentation with new financial models remains aligned with regulation, national interest, and macroeconomic resilience.

The deal comes as stablecoins, digital tokens typically pegged to the U.S. dollar, continue to gain traction worldwide. Their appeal lies in offering faster, cheaper cross-border transfers while maintaining price stability relative to volatile cryptocurrencies. In the United States, the sector has benefited from a regulatory environment under the Trump administration that is widely viewed as supportive, prompting other countries to assess how dollar-backed tokens might fit into their own payment systems.

World Liberty Financial, launched in September 2024, has rapidly become a lucrative arm of the Trump family’s business interests. Reuters has previously reported that its growth contributed to a sharp rise in income for the Trump Organization, including revenue linked to foreign entities. Last year, Abu Dhabi state-backed investor MGX used the World Liberty stablecoin to acquire a $2 billion equity stake in Binance, the world’s largest crypto exchange.

That expansion has also attracted scrutiny. Government ethics experts have warned that the Trump family’s crypto activities, unfolding alongside U.S. oversight of digital asset policy, raise potential conflicts of interest. The White House has rejected those claims.

For Pakistan, the motivation is largely practical. Remittances are a cornerstone of the economy, generating more than $36 billion annually. Authorities estimate the country has around 40 million crypto users and up to $300 billion in yearly crypto trading volumes. The central bank has already signaled plans to pilot a digital currency and finalize legislation governing virtual assets. Against that backdrop, experimenting with a dollar-denominated stablecoin reflects Islamabad’s ambition to modernize payments while remaining plugged into the global financial system.