Bhutan’s Bitcoin Mining Empire Revealed

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  • Bhutan has has discreetly established at least four Bitcoin mines running tens of thousands of machines
  • The mining operations are part of Bhutan’s economic strategy amid a financial crisis, with some sites intentionally hidden for secrecy
  • Forbes’ report, exposing the full scale, comes after the nation’s Bitcoin mining operation was disclosed in May

Bhutan’s secretive Bitcoin mining empire has been revealed, with tens of thousands of machines running on multiple sites. Forbes this week revealed that, under the rule of Jigme Khesar Namgyel Wangchuck, Bhutan has embraced cryptocurrency mining, secretly establishing at least four bitcoin mines as part of its economic strategy amid a looming financial crisis. Forbes identified at least four the sites through satellite imagery, with some plants hidden, revealing an effort to keep them secret. The existence of a national Bitcoin mining operation was revealed in May, but the report reveals the full scale for the first time.

COVID Drove Bitcoin Mining Shift

Bhutan turned to Bitcoin mining in 2020 after its tourism cratered during the COVID pandemic. Bhutan’s sovereign investing arm, Druk Holdings & Investment (DHI), confirmed its Bitcoin involvement in May but has never disclosed details.

Bhutan’s mining activities are shrouded in secrecy, with only limited official acknowledgment, although trade data indicates over $220 million in mining chips has been imported from China, raising questions about the scale and financing of Bhutan’s cryptocurrency ventures.

Increase in Imported Power

Bhutan’s Bitcoin mining is underpinned by access to cheap and clean energy. The country has huge hydroelectric resources but mining activities can be curtailed during winter when hydropower generation declines; the Asian monsoon season means that Bhutan typically experiences droughts when its hydropower plants stand largely idle for three months.

This has led it to ramping up its electricity imports in recent years, purchasing $20.7 million worth of electricity in 2023, usually from India’s largely coal-powered grid.Government officials recently warned that this bill would balloon to $72 million over the coming winter with imports needed for five months to cover demand

DHI’s spokesperson told Forbes that “Bhutan prioritises power supply for domestic consumption,” and that “Industry and business — including projects related to bitcoin mining — are accorded lower priority.” In the winter months when hydropower generation typically decreases, “mining activity may be shut down subject to electricity availability.”

We’re Going to Need a Bigger Mine

Incredibly, the four state-owned mines Forbes believes it has identified might not even be Bhutan’s largest. In 2022, the country entered a partnership with Singaporean bitcoin mining giant, Bitdeer, which made Bhutan the seat of its Asian expansion. In March, Bitdeer broke ground on a mine in the southern town of Gedu, according to satellite imagery from Planet Labs, bringing 100 megawatts (MW) online in August, the company said

DHI, which owns Bhutan’s national power company, will be supplying electricity to the site. Bitdeer disclosed in a July update that it was already running 11,000 miners and had ordered an additional 15,000 machines. When completed, the 600 MW facility will consume more energy than the rest of the nation.