The International Monetary Fund says that Pakistan’s proposal to provide subsidised electricity rates for crypto mining operations has hit the country’s ambitious plan to become a regional crypto hub just two months after announcing its strategic Bitcoin reserve.
While testifying before the Senate Standing Committee on Power, secretary Dr. Faklay Alam Irfan said the IMF refused to support targeted power packages for sectors such as the ones. Crypto miningdespite the surplus power during the winter.
“At this point, the IMF has not agreed,” Irfan told lawmakers, saying the plan remains in place by the World Bank and other development partners during the review, according to a local media report.
The IMF warned that subsidized tariffs will create market distortions in the already strained electricity sector, which will combat circulating debt of more than $4.5 billion (Rs 1.275 trillion).
The rejection revolves around months of back between Islamabad and the IMF and plans to promote industrial consumption of surplus electricity.
In September 2024, the electricity sector proposed a six-month marginal cost package for heavy industry, including crypto mining.
However, the IMF has only approved the three-month version, citing fears about market distortions. The revised November plan targeting crypto miners and data centers met the same fate.
Pakistan’s electricity sector had proposed a targeted, marginal cost-based package that provided electricity at 0.08-0.081 (Rs 22-23/kWh) per kilowatt-hour for crypto mining and other energy-intensive industries.
The government said this would promote consumption of surplus electricity and reduce capacity charges, but the IMF said it was similar to “sector-specific tax holidays that have historically created imbalances.”
“Basic tension”
“The IMF’s rejection underscores the fundamental tension. Crypto-mining can bring economic benefits, but it does not sacrifice the destabilization of the already highlighted infrastructure.” Bitcoin Mining company Cryptobond said Decryption.
“Sustainability and economic equity need to prioritize while crypto adoption is growing,” Agadi said. “Country that benefits from Web3 must first ensure that the underlying systems, such as energy, are resilient and inclusive.”
Last month, the fund raised concerns about the country’s plan to allocate 2,000 megawatts of electricity to Bitcoin mining and AI data centers.
The government failed to consult with the IMF while on the move, raising concerns about energy shortages and fiscal risks, according to reports from local media outlets. same.
Pranav Agarwal, independent director of Jetking InfoTrain India, is the country’s first listed Bitcoin Treasury finance company, suggesting a more measured approach that prioritizes sustainability and progressive implementation.
“Pakistan can start with lower power consumption and explore Heidel Power or solar farm taps to host Bitcoin miners,” Agarwal said. Decryption. “Over time, the value is clear to the IMF and other stakeholders in the government.”
Pakistan accepts cryptography
The acceptance of Pakistan’s Cryptocurrency over the past few months includes the establishment of the Pakistan Cryptocurrency Council, appointed former Binance CEO Changpeng Zhao as strategic advisor and the establishment of Pakistan’s Digital Assets Bureau in March.
This move was followed by Bilal bin Saqib as special assistant to the prime minister of blockchain and cryptocurrency.
Saqib, who also advises Trump-linked Crypto Project World Liberty Financial, announced the creation of Pakistan’s strategic Bitcoin Reserve at the Bitcoin 2025 conference held in Las Vegas.
