Pakistan and El Salvador partner on Bitcoin as IMF opposes mining plans

Pakistan and El Salvador have launched a formal bilateral agreement to advance cryptocurrency cooperation, marking the first instance of a cross-border pact that places digital assets at the forefront of foreign policy. The deal, centred on knowledge-sharing, follows a recent meeting in South America between Bilal bin Saqib, Pakistan’s Special Assistant to the Prime Minister on crypto and blockchain, and El Salvador’s President Nayib Bukele. It comes as Pakistan works to establish a government-led Bitcoin reserve, while El Salvador continues to expand its federal digital asset strategy, which began in 2021. The meeting between Saqib and Bukele focused on establishing a partnership to transfer knowledge about cryptocurrency governance and strategy, as per a Bloomberg report. El Salvador’s Bitcoin reserves hit 6,238 BTC El Salvador’s total Bitcoin holdings now stand at 6,238 BTC, equivalent to approximately $745 million at current market rates. These reserves are part of a broader national strategy, initiated in September 2021, when the country became the first to adopt Bitcoin as legal tender. Despite global scrutiny, El Salvador has continued to purchase the asset and integrate blockchain-based technologies into its economy. This ongoing accumulation reflects President Bukele’s policy of positioning Bitcoin as a long-term sovereign asset. According to an earlier government statement in June, Bitcoin remains a core component of the country’s economic diversification plans. The new agreement with Pakistan is aimed at transferring El Salvador’s experience in digital asset governance and infrastructure development. Pakistan eyes Bitcoin reserve amid IMF restrictions In contrast, Pakistan is still in the early stages of exploring a centralised crypto strategy. The nation’s government recently announced its intent to create a strategic Bitcoin reserve, with state backing. However, its plans to subsidise energy for Bitcoin mining were blocked by the International Monetary Fund (IMF), which has raised concerns over the role of cryptocurrency in state governance. Earlier this month, the IMF declined Pakistan’s proposal to allocate 2,000 megawatts of electricity for Bitcoin mining operations, citing its stance against the inclusion of crypto in official economic frameworks. The rejection comes in the context of Pakistan’s existing $7 billion loan agreement with the IMF, which remains in effect until 2027. The fund has consistently discouraged countries under its financial support programmes from adopting or promoting digital currencies. Knowledge-sharing partnership offers strategic advantages The new alliance with El Salvador could help Pakistan navigate some of these institutional hurdles. By accessing insights into how El Salvador has structured its Bitcoin acquisitions, handled regulatory frameworks, and continued crypto operations despite IMF pressure, Pakistan may be able to develop a more sustainable strategy tailored to its own constraints. While both countries are at different stages of crypto integration, the partnership formalises efforts to exchange technical, policy, and economic knowledge. For Pakistan, aligning with a country that has embedded Bitcoin into national governance may also provide leverage in ongoing global discussions about digital asset legitimacy. The post Pakistan and El Salvador partner on Bitcoin as IMF opposes mining plans appeared first on Invezz

Source: Invezz