Pakistan and El Salvador Strengthen Diplomatic Ties With New Crypto Alliance

Pakistan and El Salvador have initiated formal diplomatic ties centered on cryptocurrency cooperation, according to a report published by Bloomberg.

The partnership follows a meeting in San Salvador between Bilal Bin Saqib, special assistant to Pakistan’s prime minister on crypto and blockchain, and El Salvador President Nayib Bukele.

Pakistan and El Salvador Partner for Digital Assets

The discussions focused on knowledge-sharing in digital asset infrastructure and policy, while Pakistan plans to structure its crypto markets under regulatory oversight.

Pakistan recently allocated 2,000 megawatts for Bitcoin mining and intends to establish a national Bitcoin reserve. The government previously launched the Pakistan Virtual Assets Regulatory Authority (PVARA) to oversee the domestic digital asset market.

🇵🇰 Pakistan creates digital assets regulator PVARA to oversee crypto industry with @cz_binance and @saylor as strategic advisors amid massive 40M users and $300B annual trading volume.#Pakistan #Cryptohttps://t.co/sGm3VPdu1M

— Cryptonews.com (@cryptonews) July 8, 2025

Earlier this year, Saqib stated that up to 20 million Pakistanis currently hold crypto, despite ongoing caution from the country’s central bank.

El Salvador adopted Bitcoin as legal tender in 2021 and continues to acquire the asset while under an International Monetary Fund (IMF) agreement. According to government figures, the country holds 6,238 Bitcoins. Tether also opened a headquarters there in January.

Bitcoin Acquisition vs IMF Agreement

Pakistan is currently under a $7 billion IMF program that runs through 2027. The fund has expressed concerns about state-level digital asset purchases, but El Salvador has continued its policy regardless of the terms.

“Bitcoin keeps being an important project,” said El Salvador’s economy minister, Maria Luisa Hayem, when the government purchased seven Bitcoins despite the agreement with the IMF. “There is an asset accumulation that we’re seeing from the government perspective, from the private sector perspective.”

By forming bilateral channels focused on infrastructure and governance, countries under IMF influence may seek greater autonomy in structuring digital asset policies without triggering compliance issues or threatening macroeconomic stability.

Other emerging economies with large unbanked populations are also exploring sovereign digital asset programs, seeking to reduce reliance on foreign exchange reserves and expand financial access without altering core monetary frameworks.

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