Pakistan’s Bitcoin Mining Plan Faces IMF Hurdle
Pakistan’s ambitious plan to use surplus electricity for Bitcoin mining has hit a roadblock. The International Monetary Fund (IMF) rejected a proposal to subsidize power for energy-intensive industries, including cryptocurrency mining. The IMF warned this could destabilize Pakistan’s fragile energy market.
IMF Warns of Market Distortion
The IMF expressed concerns that subsidized electricity for Bitcoin mining could distort Pakistan’s energy market. Fakhre Alam Irfan, Pakistan’s Secretary of Power, shared these concerns with a Senate committee. The IMF believes sector-specific pricing could worsen existing power sector issues.
International Review Underway
Despite the rejection, Pakistan hasn’t abandoned the plan. The World Bank and other international partners are reviewing the proposal. Pakistan aims to refine its approach based on their feedback. The original plan offered discounted electricity rates to boost demand and use surplus capacity.
Part of Digital Transformation Strategy
This Bitcoin mining initiative fits into Pakistan’s broader digital transformation. The government proposed tax incentives and duty exemptions for miners and AI centers. The Pakistan Crypto Council, backed by the Ministry of Finance, allocated 2,000 megawatts for these projects.
Future Prospects
The reviews by international institutions will shape Pakistan’s Bitcoin mining future. While challenges remain, Pakistan sees potential in cryptocurrency mining for economic growth. The government continues to work with global partners to find a balanced solution.
