The Kingdom of Bhutan, known for its focus on “Gross National Happiness” and picturesque landscapes, has reportedly been mining Bitcoin since April 2019. Utilizing its immense hydroelectric potential that accounts for 30% of its GDP, Bhutan is mining Bitcoin with green energy, ensuring both economic growth and eco-friendly practices. However, transparency issues arise from the hidden nature of this mining operation.
Bhutanese officials revealed that mining started when the price of Bitcoin was around $5,000. Since then, Bitcoin’s price has soared to around $28,000 per coin. The Kingdom is also said to be exploring partnerships to expand its mining operations further, including a possible collaboration with NASDAQ-listed mining company Bitdeer to secure 100 MW of power for a Bitcoin mining data center in Bhutan. This partnership could result in a 12% increase in Bitdeer’s mining capacity.
However, the scale of Bhutan’s mining operations remains shrouded in mystery. Little information is available about the location, size, and profitability of its mining farms. Some employees of Druk Holding & Investments (DHI), the state-owned holding company, have listed “crypto mining” as their tasks and skills on LinkedIn, but no official statement has been made. DHI has invested millions of dollars in cryptocurrency holdings, with the funds managed on behalf of its people. Despite such investment, the government has not disclosed this project to its citizens or international partners.
Bitcoin mining has been criticized for its high energy consumption, but advocates argue that it is the world’s cleanest industry, with over 50% of its energy sources coming from renewable or clean energy sources. Michael Saylor, chairman of MicroStrategy, highlights that “99.92% of carbon emissions in the world are due to industrial uses of energy other than bitcoin mining.” Bhutan’s abundant hydroelectric power makes it an ideal destination for mining Bitcoin in an eco-friendly manner.
Countries like Bhutan are joining a growing list of regions, including East Africa and Scandinavia, that mine Bitcoin with hydropower, one of the cheapest clean energy sources available. The use of renewable energy in cryptocurrency mining signifies a step towards a more sustainable future for the industry, but concerns regarding transparency and the tightly held information surrounding these mining operations persist.
The balance between economic growth, eco-friendly practices, and transparency poses a challenge for countries like Bhutan venturing into the world of cryptocurrency mining. As more countries adopt and embrace this technology, the need for responsible and transparent practices becomes increasingly crucial for the industry’s growth and public acceptance.