In a landmark move that signals Pakistan’s intent to modernise its financial architecture, the country has signed a formal Bitcoin knowledge-sharing agreement with El Salvador. The pact, confirmed during Minister of State for Crypto and Blockchain Bilal Bin Saqib’s official visit to San Salvador, represents the first diplomatic engagement between the two nations and may prove to be a turning point in how Pakistan approaches remittances, real estate investment, and blockchain-based regulation.
According to Arab News (July 17, 2025), the Letter of Intent signed between Pakistan’s Crypto Council and El Salvador’s Bitcoin Office establishes a framework for technical cooperation, policy development, and public sector innovation centred on Bitcoin and digital assets. President Nayib Bukele’s administration, which made Bitcoin legal tender in 2021, is now working with Pakistan to explore sovereign digital strategies in emerging markets, an effort described by Pakistani officials as an exercise in “Biplomacy”, a term combining Bitcoin and diplomacy.
Building the Framework: Policy Comes First
This diplomatic move is supported by serious domestic groundwork. On July 11, Arab News reported that the State Bank of Pakistan (SBP) plans to complete a digital currency pilot within the current fiscal year, backed by the newly established Pakistan Virtual Assets Regulatory Authority (PVARA). The regulator was created through a presidential ordinance and is expected to oversee licensing, crack down on illicit financial activity, and integrate up to $25 billion in virtual assets into the formal tax net.
The regulatory momentum was further reinforced in Reuters’ coverage of the Reuters NEXT Asia Summit in Singapore (July 9, 2025), where SBP Governor Jameel Ahmad confirmed that the Virtual Assets Act, 2025, had been approved. He also announced Pakistan’s upcoming Central Bank Digital Currency (CBDC) pilot and the country’s ambition to establish a state-run Bitcoin reserve, part of a broader vision being driven by the Pakistan Crypto Council.
Remittance Revolution: $38.3 Billion Flows Home
Pakistan’s digital finance transformation comes amid record-high remittances. The News International reports that June 2025 inflows were $3.4 billion, an 8% increase YoY. Cumulatively for FY25, remittances reached an unprecedented $38.3 billion, up 27% from FY24. Key contributors included Saudi Arabia, the UAE, the UK, and the USA
Diaspora Confidence and Real Estate Implications
Beyond remittances, this new framework could restore diaspora trust in investing back home. Many overseas Pakistanis have been hesitant to send large amounts of money to Pakistan due to legal ambiguity, poor transparency, and outdated systems. But the introduction of PVARA, combined with Pakistan’s alliance with Bitcoin trailblazer El Salvador, sends a new signal: digital investment is becoming safer, more transparent, and officially sanctioned.
For the real estate sector, a major destination for overseas capital, these developments are especially relevant. Examining Bitcoin's potential uses in the public sector, such as blockchain-based property registries, tokenised real estate, and smart contract automation, is one of the primary objectives of the Pakistan-El Salvador relationship. These developments have the potential to significantly lower fraud, expedite transactions, and give foreign investors more confidence to invest in Pakistan's real estate industry.
This strategic alignment of policy, technology, and global cooperation reflects a shift in Pakistan’s positioning to a digitally ambitious economy. As Governor Jameel Ahmad stated in Singapore, Pakistan is not only identifying the risks associated with digital assets but is actively working to evaluate and manage them carefully without letting go of the opportunity.
By linking blockchain diplomacy with domestic institutional reform, Pakistan is taking deliberate steps to digitise its financial landscape. The result could be a more inclusive, efficient, and trustworthy system, one that benefits everyday citizens, overseas investors, and the state itself.
