Government of Bhutan Holds Over $825 Million, or Nearly a Third of Its GDP, in Bitcoin, Arkham Data Shows 25
The government of Bhutan is currently holding over $828 million in bitcoin, according to onchain data by Arkham Intelligence. From a report: "Unlike most governments, Bhutan's BTC does not come from law enforcement asset seizures, but from bitcoin mining operations, which have ramped up dramatically since early 2023," the crypto intelligence firm explained. Crypto intelligence firm Arkham highlighted the Kingdom of Bhutan's bitcoin holdings on social media platform X last week. Bhutan is a small, landlocked kingdom located in the eastern Himalayas, bordered by China to the north and India to the south. The country currently has a population of less than 800,000 people. We learned last year that Bhutan had been secretly mining bitcoin using its abundant hydroelectric resources since around 2019. The operation, which began when bitcoin was priced at approximately $5,000, aims to harness the country's vast renewable energy reserves to power mining rigs.
Hydroelectricity already accounts for 30% of Bhutan's GDP and powers nearly all of its 800,000 residents. The government claimed last year that mining profits are used to subsidize power and hardware costs. This revelation makes Bhutan one of the few countries globally to run a state-owned bitcoin mine, alongside El Salvador.
At over $800 million in Bitcoin holdings, the reserve accounts for nearly a third of Bhutan's 2022-calculated GDP.
Hydroelectricity already accounts for 30% of Bhutan's GDP and powers nearly all of its 800,000 residents. The government claimed last year that mining profits are used to subsidize power and hardware costs. This revelation makes Bhutan one of the few countries globally to run a state-owned bitcoin mine, alongside El Salvador.
At over $800 million in Bitcoin holdings, the reserve accounts for nearly a third of Bhutan's 2022-calculated GDP.
Good for them (Score:2)
Love it or hate it, holding BTC has been quite lucrative over the last ten years. Eventually it may fall, but for now it let's them profit richly when much larger countries overinflate their currency supply.
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Himalayan rug pull (Score:2)
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That's not how inflation works...
=Smidge=
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I'm fine with people putting their own money into Bitcoin and making profit. But we are talking aboutnational wealth. It is irresponsible to place so many eggs, apparently a third the country's entire egg inventory, into a single basket, that could be vanish at any moment. If a government fund wants to hold risky assets, it should be at least something something useful to the population, such as (for a rural country) zero-interest loans to small farmers.
Re: Good for them (Score:3)
Given they have excess grid capacity, it makes sense to invest it in the most lucrative way possible. How else could spare grid capacity provide a zero interest loan? Sure, maybe sell to a neighboring country, but it sounds like that would have paid fewer dividends.
So long as the mining hardware and power generation are paid for (which seems to be the case) then even if BTC became worthless tomorrow, nothing will have been lost except for the opportunity cost, which at this point seems to be negative alread
Maybe not as risky as you think (Score:3)
It is irresponsible to place so many eggs, apparently a third the country's entire egg inventory, into a single basket, that could be vanish at any moment.
I wouldn't be surprised if the government of Bhutan looked at what happened to Russia's reserves held in the West that were frozen (and soon to be seized outright [nbcnews.com]).
Also consider Bhutan's small size: geopolitically, it's in the shadow of two giants: China and India. Who knows when China might pull another Tibet-style annexation, or if India's hard-right ruler decides wants to offer closer "protection". In those scenarios, the Bhutanese government might well prefer an asset that exists on the blockchain, wher
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I did not say gold. I said invest the computing power or the money into developing their economy: loans to farmers, stock of national and foreign companies. I am not suggesting to trust Western countries as a storage for their money, I am suggesting to copy what Western countries do with their extra money: invest into the economy. The EU governments have investment banks, provide "loans, equities and guarantees" https://en.wikipedia.org/wiki/... [wikipedia.org]
Do you have indication that the king of Bhutan has any reason t
Re: Good for them (Score:3)
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Isn't it mostly agriculture and forestry? They're heavily dependent on India for major construction.
Currency symbol (Score:3)
Is this some sly move by the Bitcoin folks to legitimise using BTC as their currency symbol? ;) BT is normally a currency of Bhutan, such as its official currency BTN.
Tshering Tobgay (Score:1)
The grand master plan of crypto (Score:1)
The plan for all cryptocurrencies isn't what they want to make you think it is. It's more sinister than the egalitarian image the crypto boys portray for it.
After the 2008 financial meltdown, cryptocurrencies were born out of it, declared to be the means by which people could be freed from banks/governments, and promised to avoid any such future meltdowns from happening ever again.
But the crypto boys watched closely the result of that meltdown, and formulated their plan: create a new form of currency, and
Government funds (Score:1)
Governments are some of the largest holders of Bitcoin. Most of it has been acquired through seizure related to drug crimes. The US owns 212k BTC that used to belong to Silk Road, and other governments have similar holdings.
Environmental impact of bitcoin (Score:4, Insightful)
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Well, *generating* a new bitcoin uses a lot of power. Once you've generated it, though it doesn't use more power than anything else that uses a computer. And apparently Bhutan has excess hydroelectric power.
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There were more options to do if they had excess electricity and available servers (those that mine bitcoin). Make them available on the internet and sell that for money. Approach OpenAI, the CERN or even Pixar studios and propose to half the cost of their computational needs. Or run scientific projects like BOINC, GIMPS and develop a class of scientists. A lot of things you can do with computers and free electricity, and most of them are more useful to humanity than computing Bitcoin hashes.
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I'm not claiming I don't think it was a foolish choice, but electricity isn't quite as portable as you seem to thing. Bhutan is in South East Asia. They might have sold the electricity to India or someone else nearby, but I don't think CERN was a reasonable option.
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I think the suggestion was to sell processing power to CERN rather than electrical power. Possibly still not practical, because the big problem CERN has is the mindboggling high rate of data production.
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I did not mean sell electricity at all, that's the low added-value option. I meant use their cloud computing capabilities for external customers. Of which AI and things like particle physics require a lot, and does not have to be done in Switzerland. You can yourself dedicate computational resources to the CERN, even if you live very far away, see https://lhcathome.web.cern.ch/ [web.cern.ch]
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not that big (Score:2)
GDP is in dollars per year (Score:4, Insightful)
$800 million is one-third of their annual GDP, or four times their monthly GDP.
But is it really useful? (Score:3)
I guess it's nice for them to have that, but is it truly useful?
* Can they actually cash it in for real USD (or some other spendable currency)?
* Is there anyone who will give them $10M of hard cash for $10M in BTC? (because that's a good chunk of change)
* If they need to go buy a shipload of wheat, will the sellers actually take BTC?
* Or is it only useful if they can find someone else who uses BTC and will trade ... and they're screwed if no one has what they need or will not trade products or services?
Yes, I don't have any BTC so I don't really know if I could do real things or buy real goods with it or not, but then again I don't buy things in "country sized bulk" either.