Bhutan, an enchanting Himalayan kingdom renowned for its unique emphasis on ‘Gross National Happiness as a development indicator, has embarked on a daring economic journey. It is important to know that the kingdom is weaving new-age technology, specifically blockchain and drone innovation, into its traditionally rural economy. At the heart of these ventures is Druk Holding & Investments (DHI), Bhutan’s state-owned commercial holding enterprise, which is on a mission to push the envelope of technological adoption in the mountainous nation.
Cryptocurrency, specifically Bitcoin mining, is a significant part of DHI’s forward-thinking strategy. Despite the volatility of the crypto sector, DHI recently partnered with Bitdeer, a leading Singapore-based crypto company, seeking to raise about $500 million for a crypto mining business. Bhutan’s crypto venture comes in the wake of other countries, such as El Salvador and the Central African Republic, making similar bets, despite the industry’s inherent uncertainties.
Ujjwal Deep Dahal, DHI’s CEO, maintains an optimistic perspective, envisioning a digital transformation that could accelerate innovation in the country’s largely rural economy. According to Dahal, DHI is “focusing on the new generation of industries” that offer solutions to current issues and platforms for creating a diversified investment portfolio.
Hydropower fuels the crypto dream
Bhutan’s Bitcoin mining aspirations are grounded in the abundance of its hydropower resources. This renewable source of electricity is expected to fuel the energy-intensive process of Bitcoin mining, where complex mathematical problems are solved to generate new coins. Bitdeer, alongside DHI, aims to build a 100-megawatt crypto mining data center in the country, capitalizing on clean, renewable energy.
According to the World Bank, Bhutan has experienced an average annual growth of 7.5% since the 1980s and adopted a democratic constitution in 2008. The country is also known for its carbon-negative status, absorbing more carbon than it emits. Bitcoin mining could offer an avenue for Bhutan to diversify its hydropower revenues, which are currently predominantly exported to India. As per Jaran Mellerud, a Norway-based analyst at Hashrate Index, Bhutan could potentially become the “biggest Bitcoin miner per capita in the world.”
Nonetheless, the ambition to raise $500 million for a Bitcoin mining operation could face hurdles considering the tumultuous state of the industry. While Dahal maintains that mining is the “least risky vertical” in the crypto market, Mellerud warns that miners remain “extremely impacted” by bearish market conditions. DHI and Bitdeer are committed to forging ahead, even as the sector grapples with challenges.
Alongside the crypto aspirations, DHI is also exploring drone technology for applications in Bhutan’s power sector in collaboration with Japanese drone company Sora.
