- IMF confronts Pakistan over allocating scarce power to Bitcoin mining amid severe national electricity shortages.
- Diverting 2,000 MW for mining clashes directly with citizen blackouts and IMF bailout conditions.
Pakistan’s decision to dedicate 2,000 megawatts of electricity to Bitcoin mining has drawn sharp criticism from the International Monetary Fund. The government unveiled the plan at a recent conference in Las Vegas, presenting it as a means to lure cryptocurrency and artificial intelligence firms.
However, the announcement arrived at a time when the country faces acute power shortages and tense negotiations with the IMF over a new bailout package.
Early reports suggest that officials cannot explain how the electricity allocation aligns with existing agreements. Moreover, the IMF has warned that providing steeply discounted power rates to miners may breach conditions attached to financial assistance. As local sources describe, negotiators now face “stiff questions” about both the legal basis and practical feasibility of the mining push.
Pakistan’s power grid remains fragile
Frequent blackouts occur in rural areas and transmission losses exceed 20 percent in some regions. Industrial users typically pay $0.22 per kilowatt-hour, which is nearly ten times the rate seen in major mining jurisdictions such as Texas. At those prices, producing a single Bitcoin could cost the equivalent of $132,000—well above the current market value.
Even if the government grants a subsidized rate of $0.09 per kilowatt-hour, projections show that miners would still struggle to remain profitable. Local engineer Sana Zakir cautions that, “these subsidies may not be sustainable over time.” She notes that the IMF has explicitly discouraged blanket energy subsidies in recent discussions. Consequently, Pakistan risks undermining its own credibility on fiscal discipline.
A high level insight about Pakistan Bitcoin Mining plans and how to save it from Pakistan Military and Elite Capture!! pic.twitter.com/Mban7fXeo0
— Haider Mehdi (@SHaiderRMehdi) May 30, 2025
Regulatory clarity remains elusive
Authorities have not released detailed guidelines on how licenses will be awarded or how compliance will be monitored. Investors and operators require transparent rules, particularly in an industry where electricity costs can determine profit margins.
Data from international cost-of-mining indexes show that the global average cost to mine one Bitcoin lies between $40,000 and $50,000. If Pakistan’s adjusted rate of $0.09 per kilowatt-hour cannot match those figures, operators will incur losses. Therefore, the plan seems misaligned with market realities.
Authorities argue that the mining initiative will generate foreign exchange inflows and create new economic opportunities. They point to other countries that have introduced similar programs. Yet, ETHNews analysts highlight that those examples typically involve regions with lower energy costs or access to abundant renewable resources. Pakistan, by contrast, relies heavily on imported fuel and struggles to maintain existing plants.
Additionally, the broader strategy includes setting up a Bitcoin reserve. Officials claim this reserve will support a nascent trading ecosystem and boost investor confidence. Nevertheless, critics insist that a reserve cannot compensate for the underlying weaknesses in energy infrastructure. They further stress that diverting power to mining can exacerbate shortages for households and factories.
The IMF’s public statements on the matter have been firm
In press briefings, staff noted that subsidized power for cryptocurrency activities would clash with agreed policies aimed at removing distortions in the energy sector. Therefore, Islamabad now risks delays or additional conditions on future disbursements if it proceeds without revising its plan.
For the average Pakistani, the controversy holds immediate relevance. Many regions already face rolling blackouts during peak hours. When power is redirected to mining rigs—machines that operate around the clock—the strain on local distribution networks could worsen. These disruptions threaten small businesses and critical services such as hospitals.
Meanwhile, some provincial governments have begun to explore pilot programs for digital asset enterprises. Yet, without central coordination, these efforts risk creating a patchwork of rules that confuse investors. In practice, operators might receive different tariffs or face divergent compliance requirements from one province to the next.
In response to growing criticism, energy officials have promised to conduct feasibility studies and to engage with the IMF in “transparent dialogues.” They maintain that the plan could evolve based on feedback from international advisors. Nonetheless, without firm commitments on energy reforms, many experts doubt that the mining project can succeed.
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