Pakistan embarks on an ambitious cryptocurrency mining journey, allocating 2,000 MW of surplus electricity to Bitcoin operations, aiming to become a regional blockchain hub amid economic challenges and regulatory uncertainty.
Pakistan Bets Big on Crypto Mining to Transform Economy
Pakistan is making headlines with a bold and unprecedented move into cryptocurrency mining, aiming to leverage its surplus electricity and youthful tech-savvy population to position itself as a regional leader in blockchain innovation.
Once cautious about digital currencies, the South Asian nation is now rapidly embracing the transformative potential of crypto technologies. This shift marks a dramatic reversal from its earlier stance and reflects broader ambitions to stimulate economic growth, attract foreign direct investment, and create high-tech jobs.
From Bans to Bitcoin Farms: A Dramatic Policy Turnaround
In April 2018, the State Bank of Pakistan imposed a sweeping ban on cryptocurrency trading and mining, citing concerns about financial instability and illegal activities. Authorities shuttered several mining operations, yet a resilient underground mining community continued to function, relying on platforms like VIABTC and Slush Pool.
The narrative began to shift in 2020, when the Khyber Pakhtunkhwa Assembly approved legal cryptocurrency mining and green-lit state-funded Bitcoin farms powered by hydroelectric energy. This marked the country’s first formal embrace of the crypto economy, exploiting renewable resources in its mountainous northern regions.
By 2021, Pakistan ranked third globally in cryptocurrency adoption, with an estimated 15 to 20 million users and an annual crypto trading volume of $25 billion, according to Chainalysis.
2,000 MW Allocation Marks New Era for Digital Assets
In a game-changing move, Pakistan recently announced the allocation of 2,000 megawatts of surplus electricity for cryptocurrency mining and AI data centers. The initiative is being led by the newly established Pakistan Crypto Council (PCC), chaired by British-Pakistani tech entrepreneur Bilal Bin Saqib.
The PCC, working closely with the Finance Ministry, believes the project could generate nearly $2 billion in annual crypto revenue. Pakistan also introduced a Strategic Bitcoin Reserve in May 2025, joining a growing list of countries holding Bitcoin as a sovereign asset.
Surplus Energy and Tech-Savvy Youth Fuel Crypto Drive
Pakistan’s pivot toward cryptocurrency mining is driven by three major factors. Firstly, the nation has significant untapped hydroelectric, wind, and solar power, which the government now sees as ideal for powering mining farms and reducing capacity payment burdens.
Secondly, a struggling economy—marked by a devaluing rupee, high inflation, and dwindling foreign reserves—has made cryptocurrencies a popular hedge among citizens. Stablecoins, offering exposure to the U.S. dollar, have surged in popularity amid import restrictions.
Thirdly, global crypto-friendly trends—especially during the Trump administration—have emboldened Pakistan’s policymakers. The appointment of Finance co-founder Changpeng Zhao as an advisor to the PCC has added international credibility to the initiative.
Regulatory and Infrastructure Hurdles Pose Risks
Despite growing momentum, Pakistan’s crypto ambitions face significant obstacles. The country’s aging energy infrastructure is a key vulnerability. Although surplus electricity exists on paper, chronic power outages and technical inefficiencies could strain the grid if mining operations scale rapidly.
Regulatory uncertainty remains a major issue. Cryptocurrencies are still illegal under current Pakistani laws, with the State Bank of Pakistan and Ministry of Finance reaffirming this stance as recently as 2024. The contradiction between progressive rhetoric and outdated legal frameworks has alarmed lawmakers and raised red flags among international stakeholders, including the International Monetary Fund (IMF).
The IMF has voiced concerns about the 2,000 MW allocation, warning of its potential impact on electricity tariffs and fiscal stability.
Security, Transparency, and Strategic Clarity Needed
Security concerns loom large in a country historically scrutinized for illicit financing. The anonymous nature of cryptocurrencies poses risks, especially if not backed by a strong regulatory framework. The U.S. Department of Justice’s 2020 seizure of crypto assets tied to terrorist financing underscores the urgency for oversight.
To navigate these complex challenges, Pakistan has launched the Pakistan Digital Assets Authority, aimed at licensing and supervising crypto service providers. Finance Minister Muhammad Aurangzeb has emphasized the importance of regulatory clarity to build investor trust and ensure alignment with international norms.
Striking a Balance Between Innovation and Responsibility
Pakistan’s embrace of cryptocurrency mining represents a bold effort to redefine its digital economy. By combining strategic energy use with blockchain innovation, the country could emerge as a serious contender in the global crypto market.
However, its success hinges on transparent regulation, sustainable infrastructure development, and a balanced approach that prioritizes long-term stability. As Pakistan stands at the crossroads of digital innovation, the world is watching closely to see whether this ambitious crypto gamble will pay off.
