Famous for its pioneering approach of development through Gross National Happiness and environmental sustainability, Bhutan is in the global spotlight with a significant step towards financial innovation through investment in Bitcoin, the world’s leading cryptocurrency.
Himalayan kingdom, wedged between China and India, has been quietly mining tens of millions’ worth of Bitcoin in recent years by harnessing its surplus hydropower to power energy-guzzling supercomputers. Bhutan is one of the world’s few nations to have gone digital on a national level.
Prime Minister Tshering Tobgay emphasized the strategic significance of such an action, suggesting that many governments would be better off to do the same. In a March interview, he stated, “It’s just a simple strategic choice that many people have made and earned billions of dollars.”
Bhutan is a carbon-negative country and world’s first in using surplus summer hydropower to fuel Bitcoin mining. Advanced computers in it employ sophisticated maths algorithms to calculate in order to receive digital currency, according to Al Jazeera’s recent report.
This shift comes as Bhutan grapples with economic challenges, including a slowing tourism sector and a developing brain drain. With a gross domestic product of $3.52 billion and a 19 percent youth unemployment rate in 2024, the country is turning to Bitcoin as a means to help ease economic pressures.
Tourism, the main source of income, suffered tremendously during the COVID-19 outbreak. Bhutan has a limit on visitors in order to protect its environment and charges $100 per day from foreign visitors, while Indians pay $15. The country, which has space for 300,000 tourists annually, welcomed only 150,000 in 2024.
The flight of educated Bhutanese for greener pastures abroad has also been remarkable, with over 10 percent of the educated workforce leaving the country in 2022. This has impacted civil services as well, with around 1,900 workers resigning in the first quarter of 2023, dropping to 500 in the same quarter of 2024, following the introduction of a plan by the government to double the salaries of civil servants from selling $100 million worth of Bitcoin.
While Bhutan has not published its total holdings of cryptocurrency, blockchain analysis firm Arkham estimates national wealth of Bitcoin over $600 million as of April 9th, or roughly 30 percent of its GDP. The country also holds smaller reserves of other cryptocurrencies such as Ethereum and LinqAI.
Analysts also point out that Bhutan’s Bitcoin initiative is consistent with its focus on sustainability. The lower temperature reduces cooling needs for mining machines, and the high potential for hydropower as a clean source of energy. CEO of Druk Holding and Investments, Ujwal Deep Dahal, highlighted the importance of employing green energy for Bitcoin mining as part of investment strategy.
Bhutan’s foreign investment and industrialization conservatism has limited its economic options, but the Bitcoin mining presents a way to stimulate the economy with its focus on environmental ethics. During a 2019 address, King Jigme Khesar Namgyel Wangchuck stated, “Being a small nation makes us a smart nation—this is not out of choice but out of necessity. Technology is an indispensable tool that will be necessary to realize this aspiration.”
