Bhutan’s Uncommon Bitcoin Experiment Unravels
Bhutan is quietly winding down one of the most intriguing Bitcoin initiatives ever attempted by a government.
According to Arkham Intelligence data, the Royal Government of Bhutan moved around 319.7 BTC, valued at approximately $22.68 million, to two different addresses recently. About 250 BTC went to a wallet known for routing funds through Galaxy Digital and OKX, while an extra 69.7 BTC was directed to a new, unmarked address.
This transaction is part of an ongoing series of sales that have been planned for some time.
As of October 2024, Bhutan holds nearly 13,000 BTC, which were mined through a hydropower-backed operation managed by Druk Holding and Investments, the country’s sovereign wealth fund.
This operation served as a proof of concept for national-level Bitcoin mining. With relatively inexpensive renewable energy and no existing financial infrastructure to protect, the tiny, landlocked nation has found a unique opportunity to experiment.
Sales of Bitcoin have been consistent, though the remaining holdings now stand at 3,954 BTC, worth about $280.6 million, reflecting a 70% drop over 18 months. Arkham data indicates that $215.7 million in Bitcoin has been transferred from Bhutanese holding addresses this year alone, with $162.6 million sent to wallets that aren’t labeled.
The accelerated sell-off contrasts sharply with many other significant holders who are moving in the opposite direction.
Recently, a strategy was implemented that led to the purchase of 4,871 BTC for $330 million, totaling 766,970 bits. In March, U.S. spot ETFs acquired around 50,000 BTC in a single month. Likewise, the Ethereum Foundation staked $93 million worth of Ether in just one day, without liquidating any assets. Even gold-backed sovereign funds have upped their positions amid the ongoing Iran conflict.
Bhutan stands out as the sole sovereign nation engaged in such visible liquidation. Still, there are lingering questions about whether its mining operations are ongoing.
Data from Arkham suggests that Bhutan’s Bitcoin inflow has dipped below $100,000, a significant change noted over the past year. Governments that initially mined Bitcoin using their renewable energy resources might now find themselves depleting their reserves without replacing sold assets with new production.
Efforts to contact Druk Holdings regarding the current status of mining operations have gone unanswered for the past week, with outreach efforts ongoing.
This shift might be explained through an economic lens.
Even when Bitcoin was priced above $90,000, mining operations in Bhutan faced challenges. Now, with prices hovering around $71,000 and network difficulty at a record high, along with block rewards halved to 3.125 BTC, the margins for small-scale sovereign mining are increasingly tight.
The very hydropower that once made Bhutan’s mining efforts unique now offers opportunities to earn more revenue through electricity sales to neighboring India, which could overshadow the benefits of Bitcoin mining. The depreciation of mining equipment each time difficulty levels increase further complicates the picture.
Choosing to sell rather than maintain or mine Bitcoin highlights the disparity between the narrative allure of Bitcoin for nation-states and the operational challenges of enduring prolonged market downturns.
The current 3,954 BTC held by Bhutan is less than what some external strategies acquire in a typical week. It’s striking that a company based in Virginia could accumulate more Bitcoin in just five days than Bhutan managed to mine from its own landscapes.
Read more: Bhutan moves 500 more Bitcoins to exchanges as outflows exceed $150 million in 2026.
