A report from Firstpost America confirms that the Kingdom of Bhutan has approximately one-third of its gross domestic product in Bitcoin.
The leading media outlet lauded Bhutan’s silent rise to relevance in the cryptocurrency scene after harnessing its abundant hydropower resources to mine the most valuable crypto asset. Bhutan is currently the fourth-largest government holder of Bitcoin, only behind the US, China, and the UK.
Notably, Bhutan’s GDP for 2023 was $2.9 billion, up 4.5% from the previous year. Of this, 28.6% ($831 million) were proceeds from its crypto mining activities, as the nation reaped bountifully from its diversification into the sector.
Bhutan’s Secret Rise to Fame
The small Buddhist nation’s silent mining activities have established it as one of the leading holders of Bitcoin. The landlocked country has invested heavily in its mining operations through Druk Holdings and Investment, a state-owned crypto miner.
The Kingdom of Bhutan’s rich hydropower resources and a ploy to diversify its economy drove it into intensive Bitcoin mining. The operations began in 2019 and have seen the Asian country amass 13,093 BTC ($831 million).
Having invested $192 million in mining equipment between 2020 and 2023, the Asian country is poised to continue expanding its capacity. Bhutan’s Druk Holding entered a strategic partnership with Bitdeer to increase its mining input by fivefold to 500MW.
Interestingly, Bhutan is the largest government entity holding Bitcoin if seized assets were excluded. The cryptocurrencies held by the United States, China, and the United Kingdom were the product of seizures and legal battles. However, Bhutan acquired its stash from proactive mining activities and now holds more Bitcoin than El Salvador.
Notably, Bhutan holds other assets in addition to Bitcoin. Data shows it holds 656 ETH ($1.73 million), 53 SAND ($14), and 23.5 MATIC ($9.5), among others.
A Template for Widespread Adoption
Bhutan’s impressive adoption of Bitcoin and its glaring effect have set the pace for national-level adoption of cryptocurrencies. Currently, Bhutan and El Salvador are the only two countries that officially hold cryptocurrencies through willful purchases.
The obvious economic benefits Bhutan and El Salvador have amassed since adopting Bitcoin could encourage more countries with economic conditions like inflation to consider investing in the asset.
MicroStrategy’s Michael Saylor proposed a financial theory in which countries facing economic meltdown could leverage Bitcoin’s growth capacity to solve their problems. He advised countries to refocus their treasury from assets like gold, stocks, and bonds to Bitcoin.
Bitcoin’s inherent ability to grow exponentially is evident, especially for long-term holders. The asset has grown at a yearly average of 218% between 2015 and 2023.