Pakistan is formulating specialized electricity rates aimed at attracting cryptocurrency mining activities, as part of a broader initiative to capitalize on the nation’s surplus energy generation capacity.
As highlighted in a recent report, the Power Division is engaging with various stakeholders to devise competitive electricity pricing for these industries, doing so without implementing subsidies. This effort seeks to optimize the utilization of surplus energy production while minimizing capacity payments.
This strategy could be enticing to cryptocurrency miners, who typically allocate 60-70% of their revenues to cover electricity expenses. Pakistan’s existing surplus electricity situation presents potential advantages in this arena.
Power Minister Awais Leghari recently met with Bilal Bin Saqib, the CEO of the newly established Pakistan Crypto Council (PCC), to explore opportunities for global crypto miners to benefit from the country’s extra electricity supply. This meeting set the stage for the PCC’s first official gathering, which was chaired by Finance Minister Muhammad Aurangzeb and attended by prominent financial regulators.
PCC explores cryptocurrency opportunities
During the assembly, Saqib shared a vision for “utilizing Pakistan’s surplus electricity for Bitcoin (BTC) mining, potentially transforming the country’s liabilities into valuable resources.”
The council examined Pakistan’s unexploited potential within the cryptocurrency domain. They also pinpointed the need for clear regulations as a fundamental requirement for unlocking the full capabilities of the sector.
Members of the council expressed a commitment to learning from international best practices while ensuring that business and revenue models are adjusted to fit local circumstances. They also discussed the necessity of developing regulatory frameworks, legislation, and licensing schemes aimed at ensuring consumer protection, guiding blockchain mining, and establishing a national blockchain policy.
Pakistan’s stance on cryptocurrency mining stands in contrast to the varying approaches taken by other nations regarding this energy-intensive industry. China, once the primary center for Bitcoin mining, enacted a ban in 2021, citing environmental concerns and energy shortages.
Kazakhstan initially embraced cryptocurrency mining but later imposed steep electricity tariffs and taxes in response to energy deficiencies. In contrast, El Salvador, which became the first nation to recognize Bitcoin as legal tender, offers miners access to low-cost geothermal energy sourced from volcanic activity.