Pakistan is exploring the potential of using its surplus electricity to support cryptocurrency mining operations, aiming to attract blockchain-based data centers and strengthen the digital asset industry.
Government’s Strategy
Officials are working on a specialized electricity tariff to encourage crypto miners while ensuring that the initiative does not burden the national grid with subsidies. Consultations are ongoing within the Power Division to establish a cost-effective electricity tariff tailored for the crypto mining sector. This move could help absorb Pakistan’s excess power production and reduce capacity payments made to independent power producers (IPPs).
A government official noted that Bitcoin mining alone accounts for 60-70% of operational costs in electricity consumption, making Pakistan an attractive destination due to its energy surplus. However, concerns remain regarding the reliability of the power infrastructure and its ability to provide uninterrupted electricity for large-scale mining operations.
Read More: IMF Urges Pakistan To Impose Cryptocurrency Taxes
How Other Countries Regulate Crypto Mining
Globally, Bitcoin mining is known for its high energy demands, consuming over 130 terawatt hours (TWh) annually—more than the entire electricity usage of countries like Argentina or the Netherlands. Various nations have adopted different regulatory approaches:
- China: Banned Bitcoin mining in 2021 due to environmental concerns and power shortages.
- Iran: Provides subsidized electricity but halts operations during peak consumption to prevent grid overload.
- Kazakhstan: Initially welcomed miners but later imposed high tariffs and taxes due to power shortages.
- El Salvador: Uses low-cost geothermal energy from volcanoes to power its mining operations, integrating Bitcoin into its economy.
Pakistan seeks to balance economic opportunity and energy management, avoiding outright bans while ensuring sustainable power use.
Role of the Pakistan Crypto Council (PCC)
The Pakistan Crypto Council (PCC) is playing a key role in pushing for crypto mining legalization. PCC CEO Bilal Bin Saqib met with Energy Minister Owais Leghari to discuss leveraging surplus electricity for Bitcoin mining.
Finance Minister Muhammad Aurangzeb chaired the PCC’s inaugural meeting, attended by:
- Governor of the State Bank of Pakistan (SBP), Jamil Ahmed
- Chairman of the Securities and Exchange Commission of Pakistan (SECP), Akif Saeed
- Federal Secretaries from the IT and Law Ministries
During the meeting, Saqib proposed utilizing excess electricity for Bitcoin mining, turning wasted power into revenue.
Regulatory Challenges
One major concern is the absence of a clear regulatory framework for cryptocurrencies in Pakistan. Saqib emphasized studying international models and adapting them locally. The Finance Minister stressed the importance of regulatory clarity to unlock the sector’s full potential and attract foreign investment.
The PCC identified key priorities, including:
- Developing a licensing system for crypto exchanges and blockchain mining firms.
- Establishing consumer protection laws to prevent fraud and misuse of digital assets.
- Crafting a national blockchain policy to guide future initiatives.
- Launching pilot programs to assess the feasibility of large-scale crypto mining.
The PCC will collaborate with institutions already working on digital finance, incorporating their expertise into Pakistan’s crypto strategy.
Future Prospects
Finance Minister Aurangzeb called the initiative a “new digital chapter” for Pakistan’s economy, highlighting its potential to attract investment, create jobs, and empower youth in emerging technologies.
“We are committed to building a transparent, future-ready financial system that not only fuels innovation but also puts Pakistan on the global map as a leader in blockchain and digital assets,” he said.
As Pakistan advances its crypto mining plans, power stability and regulatory clarity will be critical in determining the success of the initiative.
