Pakistan plans bitcoin reserve but govt says crypto still banned at home

Within a day of unveiling a state-backed bitcoin reserve plan in the US, Pakistani officials said cryptocurrency remains illegal under current regulations and no legal change has been made

In a high-profile presentation at the Bitcoin Vegas 2025 Conference, Pakistan took the global cryptocurrency community by surprise with an announcement to establish a state-backed Strategic Bitcoin Reserve, described as a symbolic step toward long-term engagement with decentralised finance.

 

The declaration came from Bilal Bin Saqib, recently appointed as Special Assistant to the Prime Minister on Crypto and Blockchain with the status of a Minister of State. Saqib, also serving as CEO of the newly created Pakistan Crypto Council, made the announcement after delivering a keynote address attended by influential figures including US Vice President JD Vance, Eric Trump, and Donald Trump Jr.

  Also read: Bitcoin steady at $108k as market awaits move; Ethereum eyes $3,000 

“We want to thank the US because we are getting inspired from them,” Saqib said, directly tying Pakistan’s crypto strategy to US President Donald Trump’s pro-crypto stance.

 

Is cryptocurrency legal in Pakistan? Government says no

 

However, soon after, despite the government’s declarations abroad, the initiative stands in sharp contrast to the official legal position at home. According to a report in Dawn, senior Pakistani officials denied any such plan and reaffirmed that cryptocurrency transactions remain prohibited under Pakistan’s current regulations.  Also read: Donald Trump's crypto dinner raises questions about personal profit

 

On May 30, Finance Secretary Imdadullah Bosal clarified before the National Assembly’s Standing Committee on Finance and Revenue that cryptocurrency is not recognised as legal tender, citing guidance from the State Bank of Pakistan (SBP) and the Securities and Exchange Commission of Pakistan (SECP).

 

“There will be a legal framework only when the government formally takes a decision,” Bosal said, confirming that existing crypto activities remain unlawful pending legislative changes.

 

Pakistan proposes national Bitcoin wallet and crypto mining plan

 

Saqib had revealed plans for a national bitcoin wallet to hold digital assets “already in state custody,” framed not as speculative investments but as part of a “sovereign reserve” to signal Pakistan’s commitment to digital finance.

 

In a bid to attract international crypto capital and technology firms, Saqib also announced the allocation of 2,000 megawatts of surplus electricity in the initiative’s first phase. This power will support bitcoin mining and AI data centres, opening what Saqib described as a “new digital frontier” to global investors, sovereign miners, and clean energy partners.

 

“Pakistan is no longer defined by its past. It is being reborn as a forward-looking hub of digital innovation,” Saqib said in a statement from his office. “If you’re building something real, come build it in Pakistan.”

 

What is the Pakistan Digital Assets Authority and what will it do?

 

Although parallel to Saqib’s overseas campaign, the Pakistani government moved to create the Pakistan Digital Assets Authority (PDAA) on May 22, to regulate and formalise crypto and blockchain technologies.

 

According to official statements, PDAA aims to develop a FATF-compliant regulatory framework, oversee virtual asset service providers (VASPs), and integrate blockchain in land records, finance, and governance systems.

 

The Finance Division said the broader strategy was designed to monetise surplus electricity, create high-tech jobs, attract billions in foreign direct investment, and generate substantial revenue for the state.

 

Economists warn against speculative crypto strategy and public risk

 

While the government pitches crypto as an avenue for digital growth and foreign investment, several Pakistani economists are expressing alarm at what they view as a risky pivot toward fictitious assets.

 

While some of these moves appear geared toward influence-building in Washington—especially with figures close to the Trump administration taking an active interest in Pakistan’s crypto developments—economists argue that when crypto is positioned as a serious business proposition by the government, it becomes dangerous because the resources being put at risk are public.

 

One concern is the speculative nature of sovereign crypto holdings. Economists noted that suggestions to invest part of Pakistan’s foreign exchange reserves in crypto mirror tactics used by speculative brokers, highlighting bitcoin’s historic price rises without mentioning its extreme volatility.

 

Bitcoin mining in Pakistan: Why are electricity subsidies raising questions?

 

The government’s allocation of 2,000 MW for bitcoin mining has also sparked scrutiny. Economists question why crypto miners should receive electricity at subsidised rates per unit, far below the rate paid by households and industry, calling the move “puzzling and opaque.”

 

Crypto, unlike traditional assets such as money or gold, remains largely a speculative construct with limited liquidity and broader systemic risks. Experts have likened it to previous financial bubbles built on fictitious assets, from plot file scams to the collateralised debt obligations (CDOs) that precipitated the 2008 global financial crisis.