Islamabad's big blunder? Pakistan announces Strategic Bitcoin Reserve despite crypto ban at home

Pakistan Prime Minister Shehbaz Sharif (File)

In an embarrassing policy flip-flop, Pakistan appears to have tied itself in knots over its stance on cryptocurrency.

Just a day after a high-profile announcement about establishing a government-backed Strategic Bitcoin Reserve, top officials in Islamabad have now said that cryptocurrency remains banned in the country.

The clarification comes a day after Pakistan Crypto Council CEO Bilal Bin Saqib said during a Bitcoin Vegas 2025 Conference that his country is planning to launch a government-backed Strategic Bitcoin reserve. The move was hailed as "strategic" and an attempt to please US President Donald Trump, who is pro-crypto.

“We want to thank the US because we are getting inspired from them,” Bilal said after the announcement.

However, a report in Pakistani publication Dawn said that both the State Bank of Pakistan (SBP) and the Ministry of Finance (MoF) have declared that all crypto transactions are illegal in the country under current regulations.

The embarrassment played out in full view during a meeting of the National Assembly’s Standing Committee on Finance and Revenue, where Finance Secretary Imdadullah Bosal clarified that while Prime Minister Shehbaz Sharif had indeed formed a Crypto Council chaired by the finance minister to explore digital asset policies, “there will be a legal framework only when the government formally takes a decision, but the current legal status is that crypto is not a legal tender in Pakistan."

He admitted that no parliamentary approval exists for the use of cryptocurrencies, he was quoted as saying by Dawn.

Members of the finance committee were visibly baffled by the government’s mixed signals. Pakistani MP Mirza Ikhtiar Baig asked why the public was being encouraged to invest in crypto when it remained banned. Another MP, Mohammad Mobeen, raised concerns about the Pakistan government allocating power capacity to crypto mining while still declaring the entire ecosystem illegal, the report said.

State Bank of Pakistan’s executive director Sohail Jawad told the committee that the central bank had in fact declared the legal status of cryptocurrencies as illegal in 2024, and reiterated that this position “was still intact", Dawn reported.

He also said that crypto-related cases were still being referred to law enforcement by the Financial Monitoring Unit (FMU).

Sudden crypto push raises eyebrows

Bilal's announcement comes close on the heels of an intense military escalation between India and Pakistan.

Pakistan has been amplifying Donald Trump's claims that US mediated between the two nuclear-armed neighbours. New Delhi has rejected the claims and clarified that it was the Pakistani military that reached out to India, leading to a ceasefire understanding.

Islamabad has since been attempting to build closer ties with Trump, with the crypto push being seen as a strategic move in that direction.

In March, Trump had signed an executive order to established a strategic Bitcoin reserve.

Hussain Nadeem, a Pakistani AI expert and policy strategist, criticised Islamabad’s crypto pivot, calling it a politically motivated move devoid of any focus on public welfare.

“The way this regime is approaching Crypto, it has unfortunately become a yet new con that has politics, not public good, as an end goal. Why?” Nadeem questioned in a post on X.

He went on to argue that Pakistan’s ruling elite, driven by geopolitical ambitions, had little genuine interest in the transformative potential of blockchain or cryptocurrency.

“Because the geopolitics obsessed ruling elite in Pakistan has no interest in Blockchain/Crypto or how it could empower millions of people, improve democratic governance, enhance transparency and turn around Pakistan’s economy. If they actually wanted to do good, they wouldn’t be throttling internet or shutting down social media or ruining the entire tech economy in Pakistan. The entire decentralised philosophy runs entirely contrary to the regime’s interest,” he said.