Pakistan and El Salvador Forge Groundbreaking Crypto Partnership: Bitcoin Mining and National Reserves Take Center Stage

• What Does This Crypto Partnership Entail?
• Why Is Pakistan's 2,000 MW Bitcoin Mining Plan Significant?
• How Are Regulatory Frameworks Evolving in Both Countries?
• What Are the IMF's Main Concerns About This Partnership?
• What's Next for the Pakistan-El Salvador Crypto Alliance?
• How Does This Partnership Fit Into the Global Crypto Landscape?
• What Can Other Nations Learn From This Crypto Collaboration?
• Frequently Asked Questions

In a historic move that could reshape global cryptocurrency adoption, Pakistan and El Salvador have announced an unprecedented partnership focused on Bitcoin mining and digital asset infrastructure. The collaboration, formalized during a high-profile meeting between Pakistan Crypto Council CEO Bilal Bin Saqib and Salvadoran President Nayib Bukele, signals a bold step toward mainstream crypto integration for both nations. While Pakistan plans to allocate 2,000 MW to Bitcoin mining and establish a national reserve, the IMF has raised concerns about energy impacts and regulatory risks. This alliance comes as both countries navigate complex economic landscapes - El Salvador continues to champion its Bitcoin-friendly policies despite IMF restrictions, while Pakistan balances crypto ambitions with a $7 billion IMF program running through 2027.

What Does This Crypto Partnership Entail?

The Pakistan-El Salvador crypto alliance represents a strategic meeting of minds between two nations at different stages of digital asset adoption. El Salvador, the first country to make Bitcoin legal tender in 2021, brings years of practical experience to the table. Pakistan, with its emerging crypto market of 15-20 million users according to Saqib, offers substantial energy resources and regulatory ambition. The partnership focuses on three key areas: shared Bitcoin mining infrastructure, regulatory framework development, and the creation of national crypto reserves. This collaboration could potentially create a blueprint for other developing nations looking to leverage cryptocurrency for economic growth.

Why Is Pakistan's 2,000 MW Bitcoin Mining Plan Significant?

Pakistan's proposal to dedicate 2,000 megawatts to bitcoin mining operations isn't just about cryptocurrency - it's a strategic move to utilize the country's underused energy capacity, particularly during winter months. However, the plan faces scrutiny from the IMF, which worries about market distortions if miners receive subsidized electricity. The country's power grid already operates with surplus capacity at times, but preferential pricing for crypto miners could strain existing infrastructure. From an economic perspective, this initiative could potentially generate significant revenue streams, but as always in crypto, the devil's in the regulatory details.

How Are Regulatory Frameworks Evolving in Both Countries?

Pakistan made a decisive move in July 2025 by establishing the VIRTUAL Asset Regulatory Authority of Pakistan (VARAP), tasked with licensing and overseeing exchanges, stablecoins, wallets, and other digital asset services. This follows an April 2025 letter of intent between the Pakistan Crypto Council and World Liberty Financial (supported by former President Trump) aimed at accelerating blockchain adoption through regulatory sandboxes and stablecoin pilots. Meanwhile, El Salvador continues to refine its groundbreaking Bitcoin policies despite ongoing IMF reservations about new Bitcoin purchases. The country currently holds over 6,000 BTC (worth approximately $745 million) and remains committed to its crypto-centric vision.

What Are the IMF's Main Concerns About This Partnership?

The International Monetary Fund has expressed multiple reservations about both countries' crypto strategies. For Pakistan specifically, the IMF worries about: 1) Energy market distortions from potential electricity subsidies for miners, 2) Regulatory risks in Pakistan's developing crypto framework, and 3) The broader economic impact given Pakistan's existing $7 billion IMF program running through 2027. The IMF estimates Pakistan will need over $100 billion in external financing by 2029, making fiscal discipline crucial. These concerns highlight the delicate balance developing nations must strike between crypto innovation and financial stability.

What's Next for the Pakistan-El Salvador Crypto Alliance?

Looking ahead, both countries face significant challenges in implementing their shared vision. El Salvador must continue navigating IMF restrictions while expanding its Bitcoin ecosystem. Pakistan needs to finalize its mining infrastructure plans and secure necessary approvals. The partnership's success may hinge on several factors: regulatory clarity, energy pricing structures, and the ability to demonstrate tangible economic benefits from crypto adoption. As Bin Saqib noted in his meeting with President Bukele, this collaboration represents more than just a bilateral agreement - it's a potential model for South-South cooperation in the digital age.

How Does This Partnership Fit Into the Global Crypto Landscape?

The Pakistan-El Salvador alliance arrives at a pivotal moment for cryptocurrency adoption worldwide. While developed nations grapple with regulatory uncertainty, developing countries are increasingly viewing digital assets as tools for economic development and financial inclusion. This partnership demonstrates how crypto can facilitate international alliances beyond traditional geopolitical boundaries. However, as the IMF's concerns illustrate, mainstream acceptance still faces institutional hurdles. The coming years will reveal whether this innovative partnership can deliver on its promise while addressing legitimate regulatory and economic concerns.

What Can Other Nations Learn From This Crypto Collaboration?

For countries observing this partnership, several lessons emerge: 1) Crypto adoption requires careful energy planning, 2) Regulatory frameworks must evolve alongside technological implementation, and 3) International partnerships can accelerate learning curves. The Pakistan-El Salvador model shows that crypto strategies needn't follow a one-size-fits-all approach, but should instead leverage each nation's unique strengths. As both countries MOVE forward, their experiences will provide valuable case studies for the global crypto community.

Frequently Asked Questions

What is the main goal of the Pakistan-El Salvador crypto partnership?

The primary objectives are to establish cooperation on Bitcoin mining infrastructure, develop regulatory frameworks, and create national cryptocurrency reserves, with Pakistan planning to allocate 2,000 MW to Bitcoin mining operations.

Why is the IMF concerned about Pakistan's crypto plans?

The IMF has expressed worries about potential energy market distortions from subsidized electricity for miners, regulatory risks in Pakistan's developing crypto framework, and the broader economic impact given Pakistan's existing $7 billion IMF program.

How much Bitcoin does El Salvador currently hold?

As of July 2025, El Salvador's national Bitcoin holdings exceed 6,000 BTC, valued at approximately $745 million, despite ongoing IMF restrictions regarding new purchases.

What regulatory steps has Pakistan taken regarding cryptocurrency?

Pakistan established the Virtual Asset Regulatory Authority of Pakistan (VARAP) in July 2025 to oversee digital asset services, following an April 2025 agreement with World Liberty Financial to advance blockchain adoption through regulatory sandboxes.

How many cryptocurrency users are there in Pakistan?

According to Pakistan Crypto Council CEO Bilal Bin Saqib, between 15-20 million Pakistanis currently hold cryptocurrencies, representing significant grassroots adoption despite regulatory uncertainties.