While Pakistan’s election last week was expected to help materialize the popular prisoner’s massive bid for power for the next 5 years (read: 50 years), unscripted drama took the country’s political landscape by storm which threw the country into internet blackouts for the majority of the week, hurting both the public and dollar inflows through IT Services Sector remittances.
A deep-market expert told this analyst that compared to December’s record exports of $303 million, Pakistan’s tech sector exports have taken a +$4-5 million hit since the past week and over $30 million on aggregate in the past 3 weeks due to internet disruptions.
Resultantly, the State Bank of Pakistan’s data on tech sector exports in January is expected to show a substantial drop to somewhere between $200-250 million.
A deeper dive into the data provided by the individual confirmed that a key chunk of losses was incurred by freelancers and Bitcoin traders operating through third-party applications and websites for trade.
“I could be wrong but estimates show that economic losses from internet outages are growing on a daily basis. Internet blackouts cost the global economy $24 billion in 2022 and $5.62 billion in 2021. In 2023, they hit $43 billion a day and 2024 could offer more clarity on this subject as the US Dollar is expected to lose its supremacy with China and Russia leading the race in tech and business altogether. Pakistan needs to shift from the US cradle and be more flexible. Shutting off the internet is kryptonite for freelancers, especially crypto traders,” he added.
Multiple channel checks last week warned of a global economic meltdown this year with the US$ tipped to crumble as the United States’ Federal Reserve struggles to print more greenback to settle its outstanding $34 trillion debt.
The chaos could send shockwaves through assets like Bitcoin, Ethereum, and XRP.
Bitcoin, Ethereum, and XRP have all seen significant gains recently, fueled in part by US markets’ indication of a forthcoming $3.3 trillion surge in prices.
The price of Bitcoin has soared from approximately $15,000 per coin to $50,000 in recent weeks, with several big-name investors enhancing their portfolios by investing in alternative cryptocurrencies across multi-faceted trading agencies.
Concerns have been raised by a former S&P 500 commodities broker who warned of an impending economic downturn due to the staggering $34 trillion U.S. debt burden. He emphasized that the current level of US debt surpasses that of the 2008 financial crisis, and the dollar could crash if more countries join the BRICS initiative.
A Pakistani money manager, who pledged never to trade securities again earlier this year, has re-entered the market by purchasing 1 BTC from half a dozen merchants around the world. Barely reacting to my inquiry on the subject, he reiterated severe worries over the weekend, stressing the enormous rise of the dollar bubble and warning that it was rising faster than the economy itself, with future generations likely to suffer the brunt of current trends. He briefly hinted that the SBP’s move to provide a gateway for digital currencies could assist Pakistan avoid a $ collapse. “Crypto is better than gold, sweeter than wine, will last longer than wars,” he joked.
He criticized the stability of the dollar, labeling it as unsound and cautioning against the widespread perception of its safety as a haven asset. On the contrary, he sounded fully confident in the coming era of cryptocurrencies, suggesting that governments could move to unban them and issue workable legal tenders “to be a part of something big and dangerous”.
A news report last week read that cryptocurrency experts remain bullish on Bitcoin, Ethereum, and XRP, predicting a surge in prices driven by factors such as supply shocks, institutional investors’ entry into the market, and the US Federal Reserve policies. The panel anticipates Bitcoin reaching an all-time high of $100,000 in 2024, with some analysts like me projecting it to reach that level in 2025 at best.
As the cryptocurrency market braces for potential detonation amidst economic uncertainty due to the looming dollar collapse, a small chunk of Pakistani investors and idiot observers (like me) remain bullish on the future trajectory of digital assets, with both optimism and caution prevailing in equal measure.
THIS IS NOT A TRADE ADVICE.
Thank Allah that He keeps the Pakistan away from the menace of Bitcoin, which is a conspiracy to loot the wealth from the rich Muslims OPEC countries.
Its not a conspiracy. However, a lot of cyber criminals use it. So, I don’t like it either.