Pakistan is facing backlash from the International Monetary Fund regarding its plan to channel surplus electricity into its cryptocurrency mining operations. Local media reports claim that Pakistan’s Secretary of Power, Fakhre Alam Irfan, has informed the Senate Standing Committee on Energy that the IMF has rejected the country’s proposal to offer subsidised electricity to energy-intensive industries, including Bitcoin mining. The Power Division’s plan, first floated in November 2024, proposed a marginal-cost tariff of 22–23 Pakistani rupees per kilowatt-hour for industries such as copper smelting, data centres, and crypto mining. Officials argued that this would help absorb surplus capacity, generate revenue, and ultimately draw in private investment across high-demand sectors. However, according to Irfan, the IMF opposed the measure on the grounds that it could destabilise the power market. IMF officials are concerned that such targeted incentives could worsen structural inefficiencies in the country’s fragile energy sector. While the plan has not been formally withdrawn, Irfan confirmed that it remains under review by the World Bank and other international partners. According to Irfan, any major changes in the energy policy would require clearance from the IMF, in line with Pakistan’s current financing programme. As part of a national push toward digital transformation, Pakistan designated 2,000 megawatts of surplus electricity in May for Bitcoin mining and AI infrastructure. Officials viewed this as a way to monetise stranded generation capacity during off-peak seasons while positioning the country as a competitive player in the digital economy. This wasn’t the country’s first attempt to restructure its electricity pricing to support crypto-related industries. In September 2024, officials proposed offering a six-month marginal-cost tariff for high-consumption sectors, like mining and data centres. However, the IMF only allowed a three-month arrangement, citing similar objections. The IMF’s concerns centre around potential market stabilisation, especially if subsidies are used to artificially stimulate demand in selective sectors. The Fund maintains that such policies could undercut broader structural reforms and compromise energy pricing discipline. Pakistan’s ambitions to become a crypto hub Pakistan has doubled down on its long-term crypto ambitions as it plans to position digital assets at the centre of its economic modernisation strategy. Officials believe that integrating blockchain technologies can help drive job creation, attract global capital, and improve financial transparency across public systems. Key initiatives the country is currently exploring include plans to create a strategic Bitcoin reserve and build regulatory infrastructure to support the growth of decentralised finance and tokenisation platforms. At the Bitcoin 2025 conference in Las Vegas, State Minister on Blockchain Bilal Bin Saqib announced the creation of a national Bitcoin wallet to hold sovereign reserves, which would be expanded through yield-generating strategies using decentralised finance protocols. To guide its national crypto strategy, Pakistan has tapped leading global figures for support and insight. Binance co-founder Changpeng Zhao has taken on an advisory role focused on blockchain infrastructure, while Strategy’s Michael Saylor has been consulted on the design and long-term structure of Pakistan’s sovereign Bitcoin reserve. The post IMF blocks Pakistan’s plans to subsidise power for Bitcoin mining appeared first on Invezz
