El Salvador’s Bitcoin Office and Pakistan’s Crypto Council on July 16 signed a letter of intent, pledging cooperation in the field of Bitcoin.
In a statement published on X, El Salvador’s Bitcoin Office said: “The purpose of the [letter of intent] is to outline the mutual intention of the Parties to explore and establish a strategic collaboration in the fields of Bitcoin education, Bitcoin mining, sovereign Bitcoin reserves, and broader efforts to advance financial inclusion and digital economic empowerment through the responsible use of Bitcoin and decentralized technologies.”
According to Pakistani newspaper Business Recorder, an official statement released by the country’s government states that the letter of intent “establishes a formal channel for knowledge exchange and cooperation on Bitcoin-focused initiatives.”
“It lays the foundation for bilateral collaboration in areas such as public sector adoption, blockchain-based financial inclusion, and policy design for emerging economies,” it continues.
Pakistan’s Minister of State Crypto & Blockchain, Bilal Bin Saqib, described Salvadoran president Nayib Bukele as “one of the most extraordinary leaders of our time.” Bin Saqib went on to label Bukele “a head of state who doesn’t just talk tech, but challenges it, from AI and robotics to Bitcoin.”
Bin Saqib added: “El Salvador isn’t just embracing innovation, it’s writing the blueprint for the world.”
The agreement comes after Pakistan announced the establishment of a Strategic Bitcoin Reserve in May. At the time, Bin Saqib emphasized that the Reserve “is not for speculation or hype,” adding: “We will be holding these Bitcoins and we will never, ever sell them.” He described the new Strategic Reserve as “just the beginning” of Pakistan’s crypto future.
Two months later, the government announced the foundation of the Pakistan Virtual Assets Regulatory Authority (PVARA), which seeks to “[establish] a comprehensive legal and institutional framework for overseeing the country’s rapidly growing digital assets ecosystem.”
A recent Asian Development Bank report found that Pakistan ranks 8th in the world on the adoption of cryptocurrency, with Pakistanis owning around $20-$25 billion worth of digital currencies.
This represents a drastic shift from Pakistan’s position in 2018, when the State Bank issued a statement in which it clarified that virtual currencies were “not legal tender,” and told exchange companies not to “facilitate” transactions involving crypto.
While Pakistan appears to still be in the relatively early stages of establishing its crypto framework, El Salvador made history in September 2021 when it became the first country to make Bitcoin legal tender.
The Salvadoran government claims to have been buying one new Bitcoin every day since November 2022, despite the country’s $1.4 billion loan agreement with the International Monetary Fund (IMF) which requires that El Salvador “confines” public sector spending on Bitcoin.
