IMF Raises Red Flag Over Pakistan’s Bitcoin Mining Plans, Is $1.5B Loan At Risk?

Pakistan’s strategic plans to harness its energy resources for Bitcoin mining and artificial intelligence have hit a roadblock, with the International Monetary Fund (IMF) expressing concerns over the initiative. Amid the country’s energy shortages and fiscal challenges, the IMF is seeking immediate clarification from the Finance Ministry on its legality and power allocation.

Significantly, this development validates concerns raised by CoinGape in a recent report, highlighting potential IMF scrutiny.

Pakistan Faces Scrutiny over Bitcoin Mining Initiative

As reported by Samaa, a local news media, Pakistan faced increased scrutiny from the IMF regarding its potential plans to allocate 2000 MW of power for Bitcoin mining and AI. Sources within the Finance Ministry revealed that the IMF was not informed about Pakistan’s crypto mining plan. The familiar sources added that the global lender questioned cryptocurrencies’ legal status in the country.

However, the possibility of Pakistan establishing a Bitcoin reserve hangs in the balance amid the ongoing scrutiny. In a recent report, CoinGape highlighted the IMF’s possible concerns over Pakistan’s Bitcoin reserve plan, particularly given the IMF’s recent interactions with El Salvador. With El Salvador, the authority reached a state-level agreement that included requests for the country to refrain from purchasing more Bitcoin and to limit public access to the Chivo wallet app.

As per the report, Pakistan is one among the IMF programme nations and was granted $1 billion recently. The overall total loan amount is $1.5 billion with next programme review in June, 2025. Considering, IMF has maintained anti-crypto with other programme nations including El Salvador, it becomes highly possible with Pakistan as well.

Reportedly, the government has yet to establish a formal policy framework or address the IMF’s concerns regarding power tariffs and resource allocation. According to insiders, the IMF has emphasized that all policy actions under the Extended Fund Facility (EFF) require prior consultation. However, the IMF hasn’t publicly shared comments on the matter. A spokesperson cited,

There is a fear of further tough talks from the IMF on this initiative. The economic team is already facing stiff questions, and this move has only added to the complexities of the ongoing talks.

Will Pakistan Establish a Bitcoin Reserve Amid IMF Scrutiny?

Recently, during his speech at the Bitcoin Conference, Pakistan’s crypto czar, Bilal Bin Saqib, revealed the country’s plans for embracing a Strategic Bitcoin Reserve. He also revealed plans for focusing on Bitcoin mining, in an attempt to place Pakistan at the forefront of the global crypto market. Saqib stated, “We want to welcome all miners to come to Pakistan, all the infrastructure players to come to Pakistan and build with us.”

Despite the government’s enthusiasm for leveraging cryptocurrencies and blockchain technology, the absence of a formal policy framework and the IMF’s concerns over legality and power allocation pose significant hurdles. The delegation is expected to hold a dedicated virtual session with Pakistani officials to review the plan for providing electricity to Bitcoin mining and AI data centres.

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