According to reports, Pakistan's plan to utilize surplus electricity for cryptocurrency mining has encountered obstacles after the International Monetary Fund (IMF) rejected a proposal to provide subsidized electricity to energy-intensive industries, including Bitcoin miners.
According to the Urdu news media Independent Urdu, Fakhre Alam Irfan, Secretary of the Ministry of Power in Pakistan, stated at a Senate Energy Committee meeting that the IMF claimed such measures could distort the energy market and exacerbate existing issues in the country's fragile power sector.
Reports indicate that despite Pakistan having surplus electricity, especially in winter, the IMF remains concerned that pricing schemes could disrupt market balance. Irfan noted that all significant energy policies must receive IMF approval.
The power sector's plan for November 2024 proposed implementing a marginal cost electricity price of 22-23 Pakistani Rupees (approximately $0.08) per kilowatt-hour for industries such as copper smelting, data centers, and cryptocurrency mining. Officials believe this scheme would boost electricity demand and help absorb excess capacity.
Reports state that the IMF rejected the plan, likening it to specific industry tax incentives that historically caused economic imbalances in Pakistan.
Irfan pointed out that the proposal has not been completely shelved and is under review by the World Bank and other international partners. He stated that the government is refining the plan based on the guidance of these institutions.
Cointelegraph has contacted the IMF for comments but has not received a response as of the time of publication.
In May of this year, Pakistan designated 2000 megawatts of surplus electricity for Bitcoin (BTC) mining and AI centers as part of a digital transformation initiative led by the Pakistan Cryptocurrency Committee and supported by the Ministry of Finance.
At that time, Finance Minister Muhammad Aurangzeb announced tax incentives for AI centers and customs exemptions for Bitcoin miners to attract investors.
Saqib initially proposed using the country's surplus energy to power Bitcoin mining at the inaugural meeting of the cryptocurrency committee in March this year. The meeting included lawmakers, the Governor of the State Bank of Pakistan, the Chairman of the Pakistan Securities and Exchange Commission, and the Secretary of the Federal Ministry of Information Technology.
Saqib announced the national Bitcoin reserve plan at the Bitcoin 2025 conference, revealing that discussions with Michael Saylor from Strategy reaffirmed his belief in this initiative.
Saqib also stated that the country intends to use the profits generated from decentralized finance protocols to expand its Bitcoin holdings.
Related: Gate launches xStocks US stock trading section, leading the deep integration of crypto finance and global capital markets.
Original: “Reports say IMF rejects power subsidies, Pakistan's Bitcoin (BTC) mining plan hits a snag”
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