The International Monetary Fund (IMF) has raised significant concerns and requested clarifications from Pakistan following the government's announcement of a major shift towards digital assets, including dedicating 2,000 megawatts (MW) of electricity to cryptocurrency mining and artificial intelligence (AI) data centers.

This development comes amidst sensitive budget negotiations between Pakistan and the IMF. The Fund's objections emerged shortly after Pakistan unveiled its first official Bitcoin reserve at the Bitcoin 2025 conference in Las Vegas, signaling a strategic pivot towards digital finance.

**Pakistan's Digital Push:**

At the conference, Prime Minister Shehbaz Sharif's crypto adviser, Bilal bin Saqib, announced the launch of a national Bitcoin wallet and the substantial energy allocation. He emphasized Pakistan's youthful, digitally-engaged population – citing over 40 million crypto wallets and an average age of 23 – as key drivers for embracing the future of finance.

"The world is seeing Pakistan for its future, not its past," Saqib stated, inviting global investors, miners, tech firms, and blockchain companies to participate in the country's emerging digital ecosystem.

**IMF Concerns and Legal Questions:**

The IMF reacted swiftly to the energy commitment announcement. Sources report the Fund has formally sought explanations from Pakistan's Finance Minister regarding:

1. **Legality:** The legal status of digital assets within Pakistan.

2. **Resource Allocation:** The rationale for dedicating significant electricity to these sectors, especially given the country's chronic energy shortages and fiscal constraints.

Critically, the decision appears to have been made without prior consultation with the IMF. An official involved in talks noted this move has complicated sensitive negotiations, stating: "The economic team is already facing stiff questions, and this move has only added to the complexities... There is a fear of further tough talks from the IMF."

The IMF delegation, currently engaged in virtual discussions with Pakistani officials, is expected to hold a dedicated private session to scrutinize the government's electricity plan for Bitcoin mining and AI data centers. The IMF stressed that all policy steps under Pakistan's existing Extended Fund Facility (EFF) program require its consultation.

**Building a Regulatory Framework:**

This energy initiative is part of a broader government strategy to integrate digital assets into the national economy. A key pillar is establishing the Pakistan Digital Asset Authority (PDAA), approved by the Finance Ministry. The PDAA will be responsible for:

* Regulating crypto exchanges, wallets, stablecoins, and DeFi platforms.

* Overseeing the tokenization of national assets and debt.

* Aligning Pakistan's crypto regulations with international standards set by the Financial Action Task Force (FATF).

Saqib highlighted the PDAA as "a critical step in protecting global investors and formalizing Pakistan’s role in the digital economy." The event was attended by notable figures, including US Vice President JD Vance and Eric and Donald Trump Jr.

This policy shift began earlier in 2025 with proposals for a "National Crypto Council" tasked with creating a regulatory framework and attracting foreign investment. Utilizing surplus energy for Bitcoin mining and AI operations was among the council's initial suggestions.

**Key Changes in the Rewrite:**

1. **Stronger Headline:** Clearly states the conflict (IMF demands answers) and the core action (Pakistan's bold pivot).

2. **Concise Lead:** Combines the IMF concern and Pakistan's action immediately.

3. **Improved Flow:** Logically groups information: Pakistan's announcements -> IMF reaction -> Regulatory developments (PDAA).

4. **Enhanced Clarity:**

* Explains *why* the IMF is concerned (energy shortages, fiscal constraints, lack of consultation).

* Clarifies the PDAA's role and connection to the broader strategy.

* Places the "youth/wallets" quote more effectively to support Pakistan's rationale.

5. **Reduced Redundancy:** Removes repetitive phrases (e.g., mentioning the IMF "frowning" is replaced with more direct language like "raised concerns," "objected," "sought explanations").

6. **Neutral Tone:** Maintains objectivity while highlighting the tension.

7. **Removed Promotional Element:** The "Cryptopolitan Academy" blurb was omitted as irrelevant to the core news story.

8. **Active Voice:** Uses stronger verbs (e.g., "demands answers," "raised concerns," "requested clarifications," "signaling a strategic pivot").