The International Monetary Fund (IMF) has rejected Pakistan's proposals for subsidizing electricity for bitcoin mining and other energy-intensive industries, raising concerns about potential market distortions.

During a Senate Committee session, Pakistan's Secretary of Power, Dr. Fakhray Alam Irfan, confirmed that the IMF is particularly worried that such subsidies could undermine market efficiency, resembling previous tax holidays.

This decision by the IMF reflects a broader skepticism towards national-level cryptocurrency adoption, similar to its warnings issued to other countries like El Salvador regarding government involvement in Bitcoin mining.

The IMF has expressed doubts about the government's ability to revert subsidized electricity back to market rates, recalling that similar incentives in the past have not yielded successful outcomes.

Irfan noted that the proposal is still under review by the World Bank and other international partners, as the government seeks to refine it based on their feedback.

Despite the IMF's reservations, Pakistan remains committed to enhancing its cryptocurrency strategy, viewing Bitcoin as a means for financial decentralization and innovation.

The government aims to establish a strategic bitcoin reserve, drawing inspiration from U.S. policies during President Trump's administration to support BTC mining.

At the Bitcoin 2025 conference, Bilal bin Saqib announced ambitions to establish a national Bitcoin reserve and expand holdings through decentralized finance yields.

Saqib also expressed intentions to empower 100 million unbanked Pakistanis through crypto and blockchain technologies, promoting economic advancement.

In May 2025, Pakistan allocated 2,000 megawatts of surplus electricity for Bitcoin mining and AI centers as part of a broader digital transformation initiative.

The Senate Standing Committee on Power has been addressing ongoing challenges in the power sector, including electricity theft and the government's agreement with banks to reduce circular debt.

Additionally, Pakistan plans to repurpose three underutilized coal plants to support crypto mining operations and AI data centers, raising questions about national energy priorities.