Long known for measuring progress through Gross National Happiness and environmental sustainability, Bhutan is taking a significant step toward financial innovation by investing heavily in Bitcoin, the world’s most popular cryptocurrency.
The Himalayan kingdom, nestled between India and China, has quietly mined millions of dollars worth of Bitcoin in recent years. It leverages its surplus hydropower to run energy-intensive supercomputers. Bhutan is among the few countries worldwide that invest in digital assets at a national level.
“It’s just a simple strategic choice that many people have made and earned billions of dollars, and I think governments should do it,” Bhutanese Prime Minister Tshering Tobgay had said in an interview in March.
Bhutan, the first country to become carbon-negative, uses its excess hydropower during summer months to support Bitcoin mining. The process involves using high-powered computers to solve complex mathematical puzzles, earning digital coins in return, according to a recent report by Al Jazeera.
Facing economic challenges
Bhutan’s move comes amid rising economic challenges, including a shrinking tourism sector and a growing brain drain. With a gross domestic product of $3.52 billion and a youth unemployment rate of 19 per cent in 2024, the country is turning to Bitcoin to offset financial strain.
Tourism, which once accounted for a key portion of Bhutan’s income, was hit hard by the COVID-19 pandemic. To preserve its environment, Bhutan maintains strict visitor limits, charging foreign tourists $100 per day in sustainable development fees and $15 for Indian visitors. The country, capable of hosting about 300,000 tourists annually, welcomed just 150,000 in 2024.
Meanwhile, thousands of educated Bhutanese have migrated abroad for better wages, including over 10 per cent of the country’s skilled population in 2022. The loss has also impacted the civil services sector, which saw nearly 1,900 resignations in the first quarter of 2023. The number dropped to 500 in 2024, following a government move to double civil servant salaries using $100 million from Bitcoin sales.
Bitcoin holdings and sustainability
While Bhutan has not officially disclosed its total cryptocurrency holdings, blockchain intelligence firm Arkham estimates the nation holds over $600 million in Bitcoin as of April 9, equivalent to about 30 percent of its GDP. The data also suggests smaller holdings in other cryptocurrencies, including Ethereum and LinqAI.
Analysts say Bhutan’s embrace of Bitcoin aligns with its commitment to sustainability. The country’s cold climate reduces the cooling needs for mining equipment, and its abundant hydropower provides a clean energy source.
“It is important for Bhutan to capitalise on the green energy we have in terms of mining Bitcoin as a part of our investment portfolio,” said Ujwal Deep Dahal, CEO of Druk Holding and Investments, the investment arm of the Royal Government of Bhutan.
Bhutan’s conservative approach to foreign investment and industrialisation has limited other economic options. However, Bitcoin mining offers a rare opportunity to grow the economy without compromising environmental values.
“Being a small nation makes us a smart nation— this is not out of choice but out of necessity,” King Jigme Khesar Namgyel Wangchuck said in a 2019 address. “Technology is an indispensable tool necessary to realise this aspiration.”
