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The Print
4 days ago
- Business
- The Print
Crypto, crisis & the Trump connection: All about Pakistan's new Virtual Assets Act
The passage of this legislation follows the State Bank of Pakistan's ongoing preparations for launching a central bank digital currency (CBDC). SBP Governor Jameel Ahmad, speaking at the Reuters NEXT Asia summit in Singapore Wednesday, confirmed the bank is working with global tech partners and is in the final stages of drafting supporting legislation. The law, endorsed by Pakistan's President, Prime Minister and the Federal Cabinet, aims to bring structure and legitimacy to the sector. The Act mandates that any individual or company offering virtual asset services within or from Pakistan must be licensed by the Authority, which will oversee incorporation, compliance, reporting, and consumer protections. New Delhi: Months after tying up with a Trump-linked crypto firm, Pakistan passed the Virtual Assets Act, 2025 Wednesday, formally approving the establishment of an autonomous federal watchdog, the Pakistan Virtual Asset Regulatory Authority (PVARA). This will now oversee digital assets amid economic challenges and rising crypto adoption. This newly created PVARA will have broad oversight powers and include on its board a collection of key government figures: The Governor of the State Bank of Pakistan (SBP), secretaries from the ministries of Finance, Law, and IT, and chairs of regulatory bodies like SECP, FBR, and the Digital Pakistan Authority. Two independent experts and a Chairperson with a proven track record in finance, tech, or regulatory affairs will round off the leadership. Also read: Why is Pakistan going all out on crypto? There's a Donald Trump angle What's in the law? Beyond licensing, the law establishes a regulatory sandbox to allow innovation within tightly supervised conditions. A regulatory sandbox is a controlled setting that allows financial service providers to experiment with innovative products and services involving real customers, while operating under eased regulatory requirements. The law also introduces 'no-action relief letters,' offering startups room to experiment without triggering enforcement, provided they remain within certain parameters. A Virtual Assets Appellate Tribunal will hear appeals, staffed by legal, financial, and technical specialists to ensure judicial independence. The law reportedly aligns with global best practices, including those from the Financial Action Task Force (FATF), and requires compliance with Islamic finance principles. A Shariah Advisory Committee will guide the regulatory authority on whether certain virtual assets meet religious compliance standards. While the law reflects an internal push to regulate a booming grassroots crypto market, where an estimated 20 million Pakistanis are already participating, it also comes with geopolitical undercurrents. In recent months, Islamabad has sought partnerships with US-based crypto firms linked to Donald Trump's inner circle. The Trump connection In April, World Liberty Financial (WLF), a firm reportedly connected to Trump's family, committed to helping Pakistan build blockchain infrastructure and tokenise public assets. At the same time, Texas-based Fr8Tech pledged up to $20 million to purchase $TRUMP, a Trump-linked cryptocurrency, and offered to support Pakistan's blockchain development through WLF. Though the details of these partnerships remain opaque, their timing suggests Pakistan is attempting to curry favour with political players in Washington, possibly as part of a broader diplomatic balancing act in a polarised global environment. In May, the State Bank of Pakistan clarified that virtual assets are not illegal but cautioned financial institutions against engaging with them until a formal licensing system is established. Sceptics question whether Pakistan can afford this digital transformation. Despite some recent economic recovery, including a drop in inflation to 3.2% in June 2025, which is the lowest in nine years, the country remains economically constrained. The central bank's policy rate, once at a record 22%, has only recently eased to 11%. Pakistan's foreign exchange reserves, now at $14.5 billion, are an improvement from the crisis levels of two years ago, but the road ahead remains uncertain. Meanwhile, concerns about IMF disapproval persist. In May, reports claimed the International Monetary Fund had rejected Islamabad's plans to allocate 2,000 megawatts of electricity toward Bitcoin mining and AI data centres. While both the IMF and Pakistan's Power Division have denied these claims, the initiative has drawn scrutiny, especially amid ongoing IMF structural reforms under a $7 billion programme set to run until September 2027. Critics liken the crypto push to the Special Investment Facilitation Council (SIFC), a controversial economic body dominated by military officials, established in 2023 to draw foreign capital. With 36 active-duty officers reportedly involved, many worry the same elite forces may now dominate Pakistan's nascent digital asset landscape. Pakistan's push into digital finance comes amid limited fiscal space, a military-dominated investment landscape, and recent concerns from the IMF about energy allocation to bitcoin mining. In May, Pakistan's Finance Ministry earmarked 2,000 MW of electricity for bitcoin mining and AI data centers in a move that raised eyebrows in global financial circles. While both Pakistan's Power Division and the IMF later denied any formal objection, the episode reflects how delicately Pakistan must tread. Still, SBP Governor Ahmad remains optimistic. 'We are confident that after this IMF programme, we may not require an immediate follow-up,' he said. Money, IMF Pressure & crypto ambitions Pakistan's Metaverse Virtual Assets market is quietly booming. Fueled by a young, tech-savvy population, widespread smartphone adoption, and rapid internet penetration, digital assets, from NFTs to virtual real estate, are seeing a surging demand. The numbers back the trend. According to a Statista 2025 report, the sector is projected to reach a value of US$17.3 million in 2025, with an explosive annual growth rate of 43.89%, booming to US$106.7 million by 2030. By then, the number of users in Pakistan's Metaverse Virtual Assets market is expected to reach 8,24,700, with an average revenue per user (ARPU) of US$24.6. Globally, the US is expected to dominate with a market volume of US$1.3 billion in 2025, but Pakistan's rapid growth stands out given its macroeconomic constraints. Locally, the boom is being driven not just by speculation, but by changing consumer habits, the gamification of digital life, and increasing access to affordable AR/VR technology. A 2021 strategic analysis by Pakistan's Financial Monitoring Unit (FMU) had found that virtual assets pose a significant risk for money laundering and terrorism financing due to their anonymous, decentralised nature. Between January 2020 and June 2021, FMU received 447 suspicious transaction reports involving PKR 701.9 million. Most users were young IT professionals and salaried individuals using bank accounts, cards, and informal channels. The analysis linked virtual asset use to crimes such as terrorism financing, fraud, drug trafficking, and tax evasion. (Edited by Viny Mishra) Also read: Jaishankar's laser eyes meme hides how India blinded itself on crypto
Newsweek
5 days ago
- Politics
- Newsweek
US Ally Issues Warning Over China Military Expansion in Pacific
Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources. Newsweek AI is in beta. Translations may contain inaccuracies—please refer to the original content. China's "aggressiveness" in the Asia-Pacific region has been years in the making and does not depend on which U.S. administration is in power, Philippine defense chief Gilberto Teodoro warned Wednesday. "It depends on its own plan of action in the region—in our view, its own expansionist activities, its own need to control the area," he said during remarks at the Reuters NEXT Asia summit in Singapore. Why It Matters China claims nearly the entire South China Sea as its territory, citing historical rights—a position that puts it at odds with the Philippines and several other countries with competing claims. Under President Ferdinand Marcos Jr., the Philippines has mounted a strong challenge to China's growing presence within its exclusive economic zone. Chinese maritime forces have responded with blockades at disputed reefs and forceful measures during confrontations with Philippine government vessels. This has brought renewed focus on the Southeast Asian country's defense treaty with Washington, which could potentially draw U.S. forces into a conflict with geopolitical rival Beijing. Newsweek reached out to the Chinese Foreign Ministry via a request for comment by email. What To Know Asked whether U.S. President Donald Trump's leadership style had prompted China's behavior, Teodoro said Beijing's designs are "predetermined by their own leader—irrespective of who an American leader is," though he acknowledged "U.S. pushback" remains a factor. Crew members of the Philippine Coast Guard ship Teresa Magbanua wave during exercises with the United States Coast Guard ship Cutter Stratton and the Japan Coast Guard ship Asanagi in the waters around the southern... Crew members of the Philippine Coast Guard ship Teresa Magbanua wave during exercises with the United States Coast Guard ship Cutter Stratton and the Japan Coast Guard ship Asanagi in the waters around the southern Japanese city of Kagoshima on June 20, 2025. More Richard Brooks/AFP via Getty Images As for the prospect of war, the official said he believed the chances are "remote." "That would entirely depend on the internal conditions of China," Teodoro said, pointing out the Philippines is constitutionally barred from seeking war "as an instrument of national policy." He said Manila seeks to balance diplomacy with a credible deterrent. "What we are doing is merely putting a stop—as best as we can—to the illegal incursion of China, of which I do not think any country in the world supports," Teodoro said. His remarks echoed comments he made in a Newsweek interview at last month's Shangri-La Dialogue in Singapore, where he said China's actions have bred weariness and distrust. Both the administrations of Trump and former President Joe Biden have reaffirmed the U.S.' commitment to the defense treaty with the Philippines, which remains "ironclad." Beijing has repeatedly accused the Philippines of being in a pawn in U.S. efforts to contain China's rise and touted bilateral dialogue with its neighbor as the only solution to their territorial dispute. What People Are Saying Rahm Emanuel, former U.S. ambassador to Japan, said of the Asia Pacfic's hot spots during a recent interview with CNN: "On China, let me say this, everybody focuses on Taiwan. Look, you have the South China Sea with the Philippines. That is a country that's a treaty ally of the United States. You have our entire reputation and clarity of deterrence on stage. "…And Xi does not have the confidence in his own military to make that move yet [against Taiwan]. So to me, the real challenge is, first and foremost in the front queue, is the South China Sea with the Philippines." What's Next President Marcos has indicated that any deliberate act by China resulting in a Philippine death would constitute a "red line." Still, in its pushback against China, the country has sought to avoid outright conflict, opting instead to document and publicize Chinese vessel movements and incidents, such as ramming and water cannon attacks. Even so, tensions with China are driving the Philippines' ongoing $35 billion military modernization program, which includes efforts to acquire more capable fighter jets and warships.
AsiaOne
6 days ago
- Business
- AsiaOne
Singapore must develop deeper relationships with China, US, Europe: Shanmugam, Singapore News
SINGAPORE — In a multipolar world, small countries like Singapore have to develop even deeper relationships with other nations, Singapore's Home Affairs Minister K Shanmugam said on Wednesday (July 9). "There are more powers playing the game as it were, as opposed to the time when the Americans held the peace across the world. So that's changing, and in such a context, small countries like us have to develop even deeper relationships," said Shanmugam, pointing to China, the United States and Europe. Shanmugam, who is also coordinating minister for national security, was speaking in an interview at the Reuters NEXT Asia summit in Singapore that covered trade issues as well as domestic concerns such as a fake news law. On trade, Shanmugam said the US was an indispensable nation and its policies impact "every country, allies and non-allies alike", especially for a trade-reliant country like Singapore where external trade is three to four times its GDP. On Monday, US President Donald Trump sent letters to 14 countries, including allies Japan and South Korea, notifying them of tariffs of 25 per cent to 40 per cent that will kick in from August 1. In the letters, Trump warned that reprisals from countries would draw a like-for-like response. Meanwhile, China threatened to retaliate against nations that strike deals with the US to cut China out of supply chains. Singapore has not received a letter from the Trump administration this round. In April on what Trump called "Liberation Day", Singapore was hit with a 10 per cent baseline tariff, lower than its Southeast Asian neighbours, but high enough to harm the economy said the Singapore government. The trade ministry in April downgraded the nation's GDP forecast for 2025 to 0 per cent-2 per cent growth from 1 per cent-3 per cent after the US announced tariffs. The US had a goods trade surplus of US$2.8 billion (S$3.5 billion) with Singapore last year, an 84.8 per cent increase over 2023, according to the United States Trade Representative website. The city-state's data, which includes services, showed the US trade surplus with Singapore amounted to US$30 billion in 2024. The US accounted for 11 per cent of Singapore's exports in 2024 and about 55 per cent of shipments would be hit with the baseline 10 per cent tariff, estimated the central bank. [[nid:719978]]
Business Times
6 days ago
- Business
- Business Times
Singapore must develop deeper ties with China, US, Europe: Shanmugam
[SINGAPORE] In a multipolar world, small countries such as Singapore have to develop even deeper relationships with other nations, Singapore's Home Affairs Minister K Shanmugam said on Wednesday (Jul 9). 'There are more powers playing the game as it were, as opposed to the time when the Americans held the peace across the world. So that's changing, and in such a context, small countries like us have to develop even deeper relationships,' he said, pointing to China, the US and Europe. Shanmugam, who is also coordinating minister for national security, was speaking in an interview at the Reuters NEXT Asia summit in Singapore that covered trade issues as well as domestic concerns such as a fake news law. On trade, Shanmugam said the US was an indispensable nation and its policies impact 'every country, allies and non-allies alike', especially for a trade-reliant country such as Singapore where external trade is three to four times its GDP. On Monday, US President Donald Trump sent letters to 14 countries, including allies Japan and South Korea, notifying them of tariffs of 25 to 40 per cent that will kick in from Aug 1. In the letters, Trump warned that reprisals from countries would draw a like-for-like response. Meanwhile, China threatened to retaliate against nations that strike deals with the US to cut China out of supply chains. Singapore has not received a letter from the Trump administration this round. A NEWSLETTER FOR YOU Friday, 8.30 am Asean Business Business insights centering on South-east Asia's fast-growing economies. Sign Up Sign Up On Apr 2, a day that Trump called 'Liberation Day', Singapore was hit with a 10 per cent baseline tariff, lower than its South-east Asian neighbours, but high enough to harm the economy said the Singapore government. The trade ministry in April downgraded the nation's GDP forecast for 2025 to 0 to 2 per cent growth from 1 to 3 per cent after the US announced tariffs. The US had a goods trade surplus of USUS$2.8 billion with Singapore last year, an 84.8 per cent increase over 2023, according to the US Trade Representative website. Singapore's data, which includes services, showed the US trade surplus with Singapore amounted to US$30 billion in 2024. The US accounted for 11 per cent of Singapore's exports in 2024 and about 55 per cent of shipments would be hit with the baseline 10 per cent tariff, estimated the Monetary Authority of Singapore. REUTERS
Express Tribune
6 days ago
- Business
- Express Tribune
Pakistan plans digital currency pilot
Listen to article Pakistan's central bank is preparing to launch a pilot for a digital currency and is finalising legislation to regulate virtual assets, Governor Jameel Ahmad said on Wednesday, as the country ramped up efforts to modernise its financial system. Central banks globally are exploring the use of digital currencies as interest in blockchain-based payments grows. Pakistan's move follows similar steps by regulators in China, India, Nigeria and several Gulf states to test or issue digital currencies through controlled pilot programmes. At the Reuters' NEXT Asia summit in Singapore, Ahmad said Pakistan was "building up capacity on the central bank digital currency" and hoped to roll out a pilot soon. He was speaking on a panel alongside Sri Lanka's central bank Governor P Nandalal Weerasinghe, with both discussing monetary policy challenges in South Asia. Ahmad said a new law would "lay down the foundations for the licensing and regulation" of the virtual assets sector and that the central bank was in touch with some tech partners. The move builds on efforts by the government-backed Pakistan Crypto Council (PCC), set up in March, to drive virtual asset adoption. The PCC is exploring bitcoin mining using surplus energy, has appointed Binance founder Changpeng Zhao as a strategic adviser and plans to establish a state-run bitcoin reserve. It has also held talks with US-based crypto firms, including the Trump-linked World Liberty Financial. In May, the State Bank of Pakistan clarified that virtual assets were not illegal. However, it advised financial institutions not to engage with them until a formal licensing framework was in place. "There are risks associated, and at the same time, there are opportunities in this new emerging field. So we have to evaluate and manage the risk very carefully, and at the same time, not let go of the opportunity," he said on the panel. On Wednesday, State Minister on Blockchain and Crypto Bilal bin Saqib said in a statement that the government had approved the Virtual Assets Act, 2025 creating an independent regulator to license and oversee the crypto sector. Tight grip, falling rates Ahmad said the central bank would continue to maintain a tight policy stance to stabilise inflation within its 5-7% medium-term target. The central bank has cut its benchmark rate from a peak of 22% to 11% over the past year, as inflation slumped from 38% in May 2023 to 3.2% in June, averaging 4.5% in the just ended 2025 fiscal year, a nine-year low. "We are now seeing the results of this tight monetary policy transfer, both on our inflation as well as on the external account," he said. Ahmad said Pakistan was not overly exposed to dollar weakness, noting its foreign debt was mostly dollar-denominated and only 13% comprised Eurobonds or commercial loans. "We don't see any major impact," he said, adding that reserves had risen to $14.5 billion from under $3 billion two years ago. Ahmad said Pakistan's three-year, $7 billion IMF programme, which runs through September 2027, was on track and had resulted in reforms in fiscal policy, energy pricing and the foreign exchange market. "We are confident that after that (IMF programme), maybe we will not require an immediate (follow-up)." Asked whether Pakistan had financing plans lined up for upcoming military equipment purchases, particularly imports from China, the central bank governor said he was not aware of such plans.
