Tiny Country with $780 Million in Bitcoin: Bhutan

This fascinating landlocked country, located between India and China, has amassed more than $780 million worth of bitcoin (BTC) over the past few years. That’s nearly a third of the country’s gross domestic product (GDP). According to on-chain analytics tool Arkham, the country has the fourth-largest bitcoin holdings by government.

Bhutan, located in the Himalayas, sees the happiness of its citizens, a population of less than 900,000, as a better measure of the country’s well-being than money. Bhutan is the second country after El Salvador to officially hold bitcoin (BTC). The assets are held under the state-owned Druk Holdings fund.

“Bhutan has constructed bitcoin mining facilities in multiple locations, the largest of which is under the now-defunct Education City project,” Arkham X wrote in the post. “Unlike most governments, Bhutan’s bitcoin assets are not derived from assets seized by law enforcement, but rather from bitcoin mining operations, which have increased significantly since the beginning of 2023.”

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These mines are likely linked to mining giant Bitdeer (BTDR). The Singapore-based company announced that it will establish cryptocurrency mining operations in Southeast Asia in partnership with the Bhutanese government in 2023, raising more than $500 million for the venture. Shortly after, Bitdeer announced that the company had built a 100-megawatt (MW) facility in the first phase of its project.

In April 2024, Bitdeer announced that it was working to increase Bhutan’s mining capacity to 600 MW by 2025.

Smaller than Switzerland, Bhutan has limited economic diversification and a developing private sector. Most of its income comes from hydroelectric power, tourism, and agriculture. The country’s gross domestic product (GDP), the value of all final goods and services produced in the country, was expected to be around $3 billion in 2022, about half the GDP of the Maldives.

But Druk is diversifying into various sectors in a bid to expand the country’s revenue streams. Its official website lists “digital assets” as one of the main focuses of its technology-focused investment strategy, including hydroelectric projects and metaverse investments.

Druk wallets tracked by Arkham have been experiencing intense deposit and withdrawal activity over the past few weeks, receiving multiple transfers of up to 2 BTC from another miner, Foundry, and unidentified bitcoin addresses over the past week.

The Druk wallet periodically sent bitcoin to different addresses and sometimes to cryptocurrency exchanges. A transaction in early July that transferred over $25 million worth of BTC suggests the assets were likely sent to the Kraken cryptocurrency exchange for sale.