Crypto Daydreams Will Not Fix Pakistan’s Real Economy

By Hissan Ur Rehman

At a time when Pakistan’s economy demands hard work and serious reforms, some of our policymakers seem determined to escape into fantasy.

The latest example? A shiny new partnership between Pakistan’s so-called "Crypto Council" and World Liberty Financial, a side venture loosely associated with Donald Trump.

Let’s be clear: this is not an economic strategy. It is economic escapism and dangerously misplaced.

Pakistan's real crisis is painfully obvious.

According to the Pakistan Bureau of Statistics, large-scale manufacturing (LSM) contracted by 4.98% year-on-year in February 2025. Exports fell 5.7% during the first eight months of FY25.

Youth unemployment hovers around 10%, while industrial job creation continues to stagnate.

In the face of these pressing challenges, promoting cryptocurrency platforms—especially those with questionable credibility—is not just tone-deaf, it is reckless.

Crypto is no substitute for real economic growth. It does not build factories, train workers, or expand exports. It offers speculation, not stability.

Already Overexposed: The Crypto Illusion

Pakistan is already dangerously overexposed to crypto assets.

According to Chainalysis, Pakistan ranked 6th globally in crypto adoption in 2022 and remains among the top 10 in 2025. Yet early adoption has brought nothing but dollar outflows, capital flight, and financial vulnerability—without any contribution to sustainable growth.

And if there is any illusion that "regulating" crypto will solve these problems, it must be shattered:

Crypto’s entire appeal lies in evading regulation.

Attempting to control it—especially with Pakistan’s historically weak enforcement capacity—is like trying to trap smoke in a net.

The Stock Market: A Forgotten Growth Engine

Ironically, while policymakers promote crypto, they continue to ignore the stock market—the real engine of domestic investment.

The figures are stark:

- Only 0.19% of Pakistan’s population participates in the stock market.
- In comparison, 6% of Indians invest in their stock market.
- In the United States, stock market participation stands at a massive 55%.

Even Bangladesh has a much higher stock market engagement than Pakistan, by around ten times! Instead of channeling domestic savings into productive sectors like manufacturing, exports, and technology through the stock market, Pakistan risks rerouting capital into non-asset-backed crypto schemes.

Are our economic advisors unaware of these numbers?

Or worse, are they knowingly misguiding the ruling establishment to avoid the harder, messier work of real economic reform?

Crypto Platforms: A Money Laundering Risk, Not a Growth Strategy

The founder of Binance—the world's largest crypto exchange—was sentenced to four months in U.S. prison for facilitating over $10 billion in illicit transactions.

This should have served as a global warning.

Instead, Pakistan seems eager to open its doors to similar platforms.

If policymakers believe that partnering with "Trump-backed" crypto groups will win diplomatic favors, they are seriously mistaken.

World Liberty Financial is a side project with no real political weight in Washington.

It will neither protect Pakistan’s interests nor improve its international standing.

Time to Get Serious

Pakistan doesn’t need more gambling platforms. It needs real economic restructuring:

- Support for large-scale manufacturing
- Policies to boost exports
- Expansion of stock market participation
- Incentives for industrial investment

Crypto escapism is not a growth strategy. It is a distraction—one Pakistan can no longer afford. The stakes are simply too high.

The writer consults large organizations and teaches financial markets in Pakistan. Email: hissan3@gmail.com