Bilal Bin Saqib, leader of Pakistan’s crypto ecosystem, has announced that the country plans to utilize its Bitcoin reserve on Decentralized Finance (DeFi) platforms to generate returns. This strategy aims to maximize the value of national digital assets and position Pakistan as a relevant player in the global crypto sector.

Announcement Context and Creation of the Bitcoin Reserve

In May 2025, Bilal Bin Saqib, crypto minister and CEO of the Pakistan Crypto Council, revealed at the Bitcoin 2025 conference that the country will establish a national Bitcoin reserve. This fund represents an innovative step to diversify state reserves and explore new sources of revenue through digital assets.

Saqib mentioned that a conversation with Michael Saylor, CEO of MicroStrategy, strengthened his conviction about Bitcoin’s strategic value. This interaction revitalized his confidence in Bitcoin as a key asset for the national economy.

DeFi Deployment Strategy for Yield Generation

Instead of keeping the Bitcoin reserve inactive, Pakistan plans to integrate it into audited and secure DeFi protocols. Decentralized finance enables passive income through lending, staking, and liquidity provision without traditional intermediaries.

Main Methods to Generate Yields with the Reserve

• Collateralized Bitcoin loans to earn interest.
• Participation in liquidity pools to receive trading fee commissions.
• Staking of complementary tokens within the DeFi ecosystem.
This strategy seeks to balance profit maximization with capital preservation and risk mitigation against volatility and protocol vulnerabilities.

Impact on Bitcoin, Ethereum, and the Crypto Ecosystem

The initiative has several implications for the global cryptocurrency market:

• Bitcoin: Its institutional use in DeFi could increase demand and consolidate its role as a reserve asset and passive income generator.
• Ethereum: As the dominant blockchain for DeFi applications, increased activity, transaction volume, and demand for ETH for gas and smart contracts are expected.
• DeFi tokens and stablecoins: Diversification into related protocols and assets may drive adoption and valuation of other crypto assets linked to DeFi.

Regulatory Considerations and Political Challenges

Pakistan is promoting a clear regulatory framework for the responsible adoption of cryptocurrencies. However, managing a state Bitcoin reserve and deploying it in DeFi poses challenges:

• Ensuring transparency and security in public fund management.
• Establishing controls to mitigate volatility risks and vulnerabilities in DeFi protocols.
• Complying with international AML (anti-money laundering) and KYC (know your customer) regulations.
• Success will depend on the government’s ability to balance technological innovation with regulatory compliance and effective oversight.

Conclusion

Bilal Bin Saqib’s announcement on creating and deploying a national Bitcoin reserve on DeFi platforms marks a significant step in Pakistan’s institutional adoption of cryptocurrencies. This strategy seeks not only to generate returns for the country but also to strengthen Bitcoin and other digital assets as key components of the state’s financial portfolio.

The impact on the DeFi ecosystem and blockchains like Ethereum could be considerable, fostering greater activity and demand. However, establishing a solid regulatory framework will be essential to ensure security, transparency, and mitigation of associated risks.