The small nation, known for its commitment to “gross national happiness” over GDP, has capitalized on its rich hydroelectric power generated by run-of-the-river projects to mine the leading cryptocurrency at a relatively low cost.
The revelation comes from Druk Holding & Investments (DHI), led by CEO Ujjwal Deep Dahal, who stated that the company’s diverse portfolio includes mining digital assets, primarily Bitcoin, within Bhutan.
The mining operations began a few years ago when the price of Bitcoin was hovering around USD 5,000, positioning DHI as an early entrant in the cryptocurrency mining space.
Green energy and responsible mining in Bhutan
DHI’s focus on using green energy for its mining operations emphasizes Bhutan’s commitment to environmentally friendly practices in the rapidly evolving crypto industry.
The company assures that the domestic consumption, local industries, and the private sector continue to receive the highest priority for power supply, while mining gets the last priority.
During winter months when hydropower production is low, the mining operation either shuts down its machines or imports power if affordable, ensuring minimal disruption to domestic consumers and industries.
Economic implications and international partnerships
The recent revelation of Bhutan’s involvement in the mining of Bitcoin has sparked interest in the nation’s economic endeavors. This development sheds light on the country’s growing interest in the cryptocurrency market and its potential to contribute to Bhutan’s economic growth.
In 2022, the kingdom imported around $142 million worth of computer chips, contributing to nearly a tenth of its total $1.4 billion in inbound trade. This significant import of chips suggests a substantial investment in the mining infrastructure within Bhutan.
Furthermore, Bhutan has been in negotiations with Nasdaq-listed mining company Bitdeer, aiming to secure 100 megawatts of power for a Bitcoin mining data center.
The construction is slated to begin in Q2 2023 and completed by Q3 2024. This partnership would increase Bitdeer’s mining capacity by about 12%, adding to its existing data centers in Washington, Texas, and Norway.
A well-guarded secret
The revelation of Bhutan’s foray into Bitcoin mining has raised questions about the secrecy surrounding the project. Until now, the government had never disclosed its plans to its citizens or international partners.
The extent of the mining operations, the location, and profitability remain unclear, adding to the intrigue surrounding Bhutan’s crypto activities.
As the world grapples with the environmental impact of cryptocurrency mining, Bhutan’s approach to utilizing its renewable energy resources sets a positive example for other nations.
The kingdom’s commitment to green energy in its mining operations, along with its openness to international partnerships, positions Bhutan as a responsible player in the crypto industry.
With the continued expansion of mining operations in the country, it is highly likely that it will attract a significant amount of attention and investment from various international players in the digital currency sector.
This trend will inevitably lead to an increase in overall economic activity and potentially open up new opportunities for both the country and its citizens.