A province in Pakistan will set up two Bitcoin mining farms using funds provided by the government. The government of Khyber Pakhtunkhwa (KP), the third-largest province of Pakistan’s four, announced that it is launching two state-backed bitcoin mining facilities, local news media BOL News reported.
Ziaullah Bangash, the advisor to KP’s Chief Minister on Information Technology, said the government has already approved the funds for the digital mining initiative. However, the amount dedicated to setting up the mining farms and the mining capacity of the facility were not revealed.
Bangash also added that a bill that legalizes such projects was passed in the local Provincial Assembly. Another bill was passed that allows individuals to engage in cryptocurrency mining or issue their tokens without fear of being on the wrong side of the law.
A self-proclaimed crypto-influencer Waqar Zaka filed a petition in a High Court against the State Bank of Pakistan (SBP) seeking the legality of bitcoin. A Joint Director of the SBP, the country’s central bank, told the court that cryptocurrencies were not declared illegal.
Bangash added that the government feels that it should not take a backseat and be left behind when it comes to cryptocurrency mining.
This marks the first instance that a government sets up a farm to mine bitcoins for profits.
Pakistan’s economy has slowed down in recent years and cryptocurrency mining could be a gateway for the country’s economic revival.
Crypto regulation in Pakistan
Cryptocurrency regulation in Pakistan is still mired in legal red tapes, much like it is with other nations. However, local governments and individuals are lobbying for regulation that legalizes the nascent cryptocurrency industry.
The KP government has led the campaign to open up the cryptocurrency industry. After this move to mine Bitcoin by the KP government, Bangash expects other provinces to take a similar route.
The province’s cool and mountainous areas provide a conducive environment for setting up crypto mining which uses machines known for consuming huge amounts of energy.
This development comes at a time when Zaka’s cryptocurrency mining project was approved after “years of struggle.” Zaka gave a shout out to Bangash for understanding his Bitcoin vision when no one did.
Finally, my dream project is approved , after years of struggle , I am launching the biggest Crypto mining Farm in KPK where you all can invest & earn. Honestly no one understood my Bitcoin vision except @ZiaBangashPTI . To become member https://t.co/c1fxqbMKoZ pic.twitter.com/oFS3RqUMaX
— Waqar Zaka (@ZakaWaqar) January 11, 2021
A recent electricity blackout plunged Pakistan into total darkness although other areas had power. The government blamed a ‘technical fault’ as the reason for the blackout.
Iran, a country hard-hit by sanctions, legalized cryptocurrency mining. The government is ready to buy bitcoins from licensed miners and use digital assets to pay for imports. And just like Pakistan, Iran recently experienced a massive blackout.