Pakistan is set to introduce special electricity tariffs aimed at attracting cryptocurrency mining operations in a push to utilize the nation’s surplus power generation capacity.
The Power Division is actively engaging with various stakeholders to create competitive electricity rates for the cryptocurrency sector, aiming to do so without resorting to subsidies. This initiative seeks to capitalize on the country’s excess power production while minimizing capacity payments.
This strategic move could be beneficial for cryptocurrency miners, who typically allocate 60-70% of their earnings towards electricity costs. With Pakistan currently boasting a surplus in electricity production, the country holds a competitive edge in this sector.
Power Minister Awais Leghari recently met with the chief executive of the newly formed Pakistan Crypto Council (PCC) to explore opportunities for international crypto miners to take advantage of Pakistan’s excess electricity. This meeting coincided with the PCC’s first session, which was chaired by Finance Minister Muhammad Aurangzeb and involved key financial regulators.
Pakistan Explores Cryptocurrency Mining Opportunities
During the PCC meeting, the vision was presented for utilizing Pakistan’s surplus electricity for Bitcoin (BTC) mining, aiming to transform the nation’s liabilities into valuable assets.
The council acknowledged Pakistan’s significant untapped potential in the cryptocurrency sector and underscored the importance of regulatory clarity to realize its full capabilities.
The council agreed to draw from global best practices while tailoring business and revenue models to fit the local context. Discussions also revolved around the establishment of regulatory frameworks, legislation, and licensing structures focused on consumer protection, blockchain mining, and a national blockchain policy.
Pakistan’s proactive stance on cryptocurrency mining comes amid diverse regulatory approaches adopted by various countries in the energy-intensive industry. China, once the leading Bitcoin mining nation, banned the practice in 2021 due to environmental and power concerns, while Kazakhstan initially embraced crypto mining but later raised electricity tariffs and taxes amidst energy shortages. Conversely, El Salvador, the first nation to recognize Bitcoin as legal tender, offers miners low-cost geothermal energy sourced from volcanoes.
