The Kingdom Of Bhutan Has Been Quietly Mining Bitcoin For Years (forbes.com) 25
The Himalayan kingdom confirmed it has been running a bitcoin mining operation as mystery surrounds the scale of its earlier cryptocurrency investments. From a report: Beneath the Himalayas, rivers fed by ancient glaciers supply the tiny kingdom of Bhutan with immense stores of hydroelectricity. The renewable resource has become an economic engine, accounting for 30% of the country's gross domestic product, and fueling the homes of nearly all of its 800,000 residents. But for the past few years, Bhutan's royal government has been quietly devising a new use for these reserves: powering its very own bitcoin mine. Sources familiar with Bhutan's efforts to develop sovereign mining operations told Forbes that discussions have been occurring since 2020, though until this week its government had never disclosed its plans.
Bhutan sought to harness the country's hydroelectric plants to power racks of mining machines that solve complex mathematical problems in order to earn bitcoin rewards. Once completed, this would make Bhutan one of the only countries to run a state-owned mine, alongside El Salvador. On Saturday, days after Forbes contacted Bhutanese officials with questions about the mining scheme, a government representative confirmed to local newspaper The Bhutanese that it had begun mining "a few years ago as one of the early entrants when the price of Bitcoin was around USD 5,000."
It explained that the earnings go towards subsidizing power and hardware costs. Bhutan's Ministry of Finance did not respond to a list of questions from Forbes about the scope of the enterprise. It's unclear when mining began, where it's located and whether the scheme has turned a profit. (As for the start date, bitcoin was valued at $5,000 in April 2019.) It's also unclear why Bhutan never disclosed the project to its citizens or international partners.
Bhutan sought to harness the country's hydroelectric plants to power racks of mining machines that solve complex mathematical problems in order to earn bitcoin rewards. Once completed, this would make Bhutan one of the only countries to run a state-owned mine, alongside El Salvador. On Saturday, days after Forbes contacted Bhutanese officials with questions about the mining scheme, a government representative confirmed to local newspaper The Bhutanese that it had begun mining "a few years ago as one of the early entrants when the price of Bitcoin was around USD 5,000."
It explained that the earnings go towards subsidizing power and hardware costs. Bhutan's Ministry of Finance did not respond to a list of questions from Forbes about the scope of the enterprise. It's unclear when mining began, where it's located and whether the scheme has turned a profit. (As for the start date, bitcoin was valued at $5,000 in April 2019.) It's also unclear why Bhutan never disclosed the project to its citizens or international partners.
Re: Tons of free energy? It would be terrible to (Score:5, Interesting)
You don't get foreign money to buy things without doing something you can sell to foreigners.
So, if they can provide infinite power to their country, but can't viably sell that power to their neighbours then they'd still have no foreign money to buy goods to upgrade their society.
I'm not a fan of Bitcoin, but it might be the most viable thing for them to sell
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Re:Tons of free energy? It would be terrible to (Score:5, Insightful)
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Electricity isn't some magic substance you pour on a problem and it goes away. Money is. Bitcoin mining, at least for a while, was a fairly efficient method of turning electricity into money.
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Money doesn't fit the bill there, either. It can help, but inevitably someone has to have an actual solution to your problem. Throwing money at it isn't a solution in-and-of itself.
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For developing countries like Bhutan, most of their problems have tested solutions. Specifically all of the things listed by the OP are pretty easily accomplished given enough foreign currency, and fairly difficult to accomplish, at least quickly, without it.
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That works until you saturate your local economy with foreign currency without increasing access to the materials and labor you need to do things like build roads. If someone dumps $1 trillion USD on Bhutan today, the best they can hope to do is hire foreign interests to do the work for them. There's no real indication that they have idle manpower and resources they could muster if only they had more units of currency to circulate through their economy. However, the more money Bhutan throws at things lik
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Yes, lets decide on investing in large infrastructure projects, that will take years to complete.
Also, why don't we let our energy surplus go to waste, waiting for our projects to catch up with our surplus, years in the future.
I mean, that's how you know you love the dollar with all your heart, right?
Re:Tons of free energy? It would be terrible to (Score:5, Insightful)
Who's to say they're not already doing that? Their current king wants to mondernize the country, but not westernize it [indiatimes.com]. In other words, build slowly instead of destroying what they have.
As the above article mentions, the people are so orderly they don't have any traffic lights and follow the directions of the police.
Considering their lifestyle, they don't need the vast amounts of healthcare western countries do. The basics with a hospital thrown in for the big stuff is probably all they need.
I know, it's difficult to understand how a country shouldn't be exploiting everything the Nth degree. Perhaps changing a frame of mind might help.
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You're making a cardinal error here: It's not GP that's doing the deciding. It's those poor downtrodden disadvantaged backward primitives that looked at "western civilisation" and thought "we like civilisation but you can keep that western bit, TYVM".
That puts them in good company, as it was Mahatma Gandhi who thought of western civilisation that "it would be a good idea".
If you think even that is "racist" somehow, the problem is you.
Which is not to say that there aren't patronising dimwits who'll try an
Low cost supercomputing (Score:2)
I've never run the numbers myself, but it seems like a more reliable source of cash would be lower cost supercomputing nodes to rent out. Though maybe that requires too much actual expertise in system design and security?
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It's easier to buy some Bitcoin ASICs from Bitmain than it is to operate actual supercomputers and lease them out to data scientists.
quietly (Score:3)
Move over Saud Family! (Score:2)
There is a NEW monarchy (constitutional) with a vast supply of energy that will become a global financial force.
Maybe a use for Bitcoin? (Score:2)
If there is a lot of hydroelectric power available, in one way, this is a waste, because some industry like aluminum smelting or some other energy-intensive item (thermal depolymerization can be quite useful to convert waste plastic into monomers), or even synthetic fuel similar to what Audi is doing in Chile.
I'd probably say that making synthetic gasoline and exporting it from CO2 from the air would be a lot more productive than just burning energy for Bitcoins, and a lot better for the environment. Howev
Life Pro Tip (Score:2)
Nice work, Bhutan.
Side note: The fact that the writer of the article refers to this action as a "scheme" tells you the media bias on the subject.
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Side note: The fact that the writer of the article refers to this action as a "scheme" tells you the media bias on the subject.
No, it tells you that the article comes from somewhere else in the Anglosphere than the US. In Australia, New Zealand and UK, infrastructure projects are called 'schemes'. Only in the US has the word assumed a pejorative connotation.
Like Iceland and aluminum (Score:4, Insightful)
Aluminum accounts for nearly 40% of Iceland's exports, yet the island has no alumina reserves. Alcoa imports alumina, then smelts it on the island. Why go through the trouble of shipping heavy loads to and from a frozen island in the North Atlantic? Because the process of smelting alumina into aluminum is hugely energy intensive, electricity is basically a required input, and Iceland has tons of it (thanks, volcanoes!). Effectively, Iceland has found a way to export their electricity, despite being relatively geographically isolated.
It's important for an economy to have a way to have foreign currencies coming in. Bhutan's geography also makes trade of physical goods difficult, but Bitcoin mining is their method of exporting electricity.
I wish I were an early entrant (Score:2)
$5000 "Early entrant"
No, that would have been me, seeing this funny thing at less than a penny and not dumping $100 into it for the hell of it.
Just Think (Score:2)