Battle for Bitcoin dominance

Donald Trump is determined to establish a national bitcoin strategic reserve. Russian President Vladimir Putin has declared that Bitcoin (BTC) and digital currencies are unstoppable. Meanwhile, Chinese President Xi Jinping may be on the verge of sparking a $1.4 trillion Bitcoin and crypto market surge. In Japan, lawmakers led by Satoshi Aoyama have put forward a proposal to create a national Bitcoin reserve.

Public statements, policy discussions and market trends reveal that several nations are exploring the possibility of building Bitcoin reserves. Among these are Brazil, Poland, the UAE, Singapore, Switzerland, France, the UK, Canada, Australia, Thailand and the Philippines -- each signaling growing interest in leveraging Bitcoin as a strategic asset.

The US government is reported to hold approximately $20 billion worth of Bitcoin, followed by China with $19 billion. The UK holds $6 billion, Bhutan $1 billion and El Salvador $600 million. Among corporations, MicroStrategy leads with a $44 billion Bitcoin holding, followed by Marathon ($4 billion), Riot Platforms ($1.7 billion), Tesla ($994 million), and Coinbase ($970 million).

Within the US, several states have expressed interest in establishing their own Bitcoin reserves, including Wyoming, Texas, Florida, New Hampshire, Colorado, Arizona, New York, California, Washington and Illinois.

The Bitcoin Act of 2024 (S.4912), which proposes designating Bitcoin as a ‘Strategic National Reserve’, is currently awaiting approval in the United States Congress. In Russia, State Duma Deputy Anton Tkachev has introduced a proposal to establish a strategic Bitcoin reserve. Similarly, the RESBit bill, which seeks to allocate up to 5.0 per cent of Brazil’s international reserves to Bitcoin, is under consideration in the Brazilian Congress.

Thailand, the Philippines, Paraguay, Panama, South Korea, India, Nigeria, Ghana, Kenya, South Africa, Australia, Canada, Germany, the United Kingdom, Singapore, Hong Kong, Japan, Morocco, Tunisia, the UAE, Qatar, France and Switzerland are all exploring ways to diversify their portfolios and reduce reliance on traditional assets like gold and the US dollar. There’s a growing recognition that owning Bitcoin can enhance a country’s geo-political influence and bargaining power. Bitcoin can help nations reduce their dependence on the traditional financial system and its associated risks, such as sanctions and currency manipulation.

For Pakistan, Bitcoin can streamline and lower the cost of remittances, a vital source of foreign exchange for the country. For Pakistan, early adoption of Bitcoin and blockchain technology could also offer the country a competitive edge in the global digital economy. For us, cryptocurrencies like Bitcoin can help bridge the financial inclusion gap by providing essential financial services to the approximately 60 per cent of the country’s adult population that remains unbanked.

The world is undergoing a seismic shift, transitioning from a hard money era to a digital asset revolution. The monetary system is undergoing a radical transformation. The very foundations of the old financial system are being deconstructed.

Pakistan must seize the transformative potential of Bitcoin. From geopolitical influence to financial inclusion, Bitcoin offers Pakistan unparalleled opportunities. The country must embrace this digital revolution to secure its future.