The Securities and Exchange Commission of Pakistan (SECP) has published a position paper on regulating digital assets. The paper outlines the concepts applicable for a nascent digital finance industry in Pakistan, examines regulatory frameworks in place in other jurisdictions and potential approaches to regulate digital assets in Pakistan. This position paper focuses exclusively on Asset backed Security Tokens/Digital Assets and does not include any form of virtual/cryptocurrency or central bank digital currency. One of the key advantages of digital assets is the ability to fractionalize each asset. Digital assets can be broken into more affordable and transferable units that create an opportunity for greater liquidity and investor diversity. Fractional ownership and trading of Digital Assets in secondary markets unlock liquidity in previously illiquid markets, creating entirely new tradable assets – such as real estate tokens – and enabling a more standardized form of trading for currently illiquid assets, such as corporate bonds.