Key conclusions

• Bhutan is using surplus, carbon-free hydropower to mine Bitcoin, converting excess electricity into seamless digital exports rather than limiting generation.

• Mining and escrow are handled by sovereign investment arm Druk Holding and Investments (DHI) and are restricted to designated jurisdictions, limiting retail exposure.

• Officials describe mined Bitcoin as a buffer of foreign currency liquidity that was already supporting government finances.

• The central bank only allows crypto activities under a phased, sandbox-style framework linked to Gelephu Mindfulness City, with an emphasis on risk control and transparency.

Bhutan’s stance towards the cryptocurrency world is basic: if a country has bountiful renewable energy resources and restricted domestic demand, it can turn electrons into digital assets.

In practice, the Himalayan kingdom is quietly doing just that: using hydropower to mine Bitcoin (BTC) on an industrial scale and to build a state-backed, values-based “green digital asset” strategy that officials say can generate strenuous currency liquidity, support public spending and support develop the country’s technology workforce.

Step 1: Start with the only natural resource that scales

Bhutan’s energy system is dominated by hydropower, and electricity exports, especially to India, constitute a major pillar of the economy. According to reports from the leader of Bhutan views increased hydropower capacity as a prerequisite for scaling “green” crypto ambitions.

Government’s own energy planning documents frame this expansion in gigantic numbers. Bhutan’s 2025 National Energy Policy cites a “techno-economically viable hydropower potential” of 33,000 megawatts (MW) based on the 2040 Power System Master Plan and positions hydropower, alongside solar, wind and storage, as key to long-term growth.

World Bank report similarly places Bhutan’s possible hydropower potential at around 33 gigawatts and notes the macroeconomic impact of recent IT equipment imports linked to the expansion of cryptocurrency mining.

Recent cross-border project announcements highlight how physical expansion has become. In November 2025, India initiated the 1,020 MW Punatsangchhu-II hydropower project and extended a up-to-date credit line related to deeper energy cooperation. Officials also noted that Bhutan’s domestic energy demand is approximately 1,000 MW and surplus electricity is exported.

Step 2: Exploit excess hydropower as ‘computational fuel’

Bhutan’s crypto strategy is as follows he led the way by Druk Holding and Investments (DHI), the commercial investment arm of the Royal Government.

In an April 2025 interview with Reuters, DHI CEO Ujjwal Deep Dahal he said Bhutan started adding cryptocurrencies to the DHI wallet in 2019. He described Bitcoin mining as a way to enhance access to foreign currency liquidity and create value from surplus hydropower.

According to senior officials in Thimphu, Bhutan has been using some of its cryptocurrency profits to pay government salaries for the past two years.

A key industrial lever is the Bitdeer and DHI partnership, announced in May 2023, Bitdeer said the parties plan to launch a closed-end fund of up to $500 million to develop a zero-emission digital asset mining operation in Bhutan, leveraging the country’s renewable energy and Bitdeer’s mining expertise.

Step 3: Think of Bitcoin as a financial buffer for the seasonal network

Hydropower systems often suffer from a timing problem: production can enhance when river levels are high and decrease when flows drop.

In January 2025, the Gelephu Mindfulness City (GMC) project in Bhutan described the country’s approach as a way to monetize excess summer hydropower using “green Bitcoin” and then convert that value back into electricity or imports when power is lower. The project quoted DHI’s Dahal, who described Bitcoin “strategically as a battery.”

This “battery” phrase matters because it is one of Bhutan’s most consistent arguments that mining is not just speculative. Instead, it is positioned as adjacent to infrastructure, turning otherwise restricted renewable energy generation into a liquid reserve asset.

Step 4: Maintain sovereignty and increasing regulation

Bhutan’s mining and reserves efforts have attracted attention because they are state-linked rather than purely private. In September 2024, blockchain analytics company Arkham revealed that it identified Bitcoin holdings on its platform linked to the government of Bhutan and characterized those holdings as coming from mining rather than confiscation. However, onchain estimates fluctuate based on price movements and wallet assignment and should not be treated as audited public accounts.

On the regulatory front, Bhutan’s central bank, the Royal Monetary Authority (RMA), has publicly signaled a controlled approach. On April 30, 2025 announcement titled “RMA Regulatory Position on Cryptocurrencies”, the RMA said it would adopt a phased and focused strategy.

The notification stated that cryptocurrency mining and exchange will only be allowed for entities registered with the GMC. Participation would also be restricted to business partners operating within the GMC.

This sandbox-like restriction is consistent with the GMC’s positioning as a special jurisdiction with its own set of policy tools and a significant pillar of finance and digital assets. This framework includes the proposed “ter” blockchain-linked currency concept and the planned fully proprietary digital bank Oro Bank.

Did you know? In 2024, Bitcoin mining activities linked to the state of Bhutan generated an estimated $750 million in revenueAccording to blockchain analytics firm Arkham Intelligence.

Step 5: The green coin narrative and its risks

Bhutanese officials clearly emphasize the climate aspect. For example, Dahal argued that coins mined using Bhutan’s hydropower offset coins mined using fossil energy elsewhere and contribute to a green economy.

However, even in a system based on renewable energy sources, this risk does not disappear:

• Volatility and fiscal risk: Bitcoin’s price can fluctuate wildly, and using a volatile asset in public finances introduces budgetary risk, even if investments are built on surplus energy rather than taxes.

• Transparency: Onchain tracking is not the same as official disclosure. Controlled reporting and clear management are essential when reserves are linked to the state.

• Financial crime and consumer protection: Gradual RMA stance and restriction of permitted activities to GMC registered entities reflect preferring controlled participation rather than open retail speculation.

Testing Bitcoin’s green model

Bhutan’s Bitcoin Green Economy Is Not a Meme Trade; it is a state-led attempt to combine up-to-date exports, digital assets, with the country’s existing comparative advantage in renewable energy. The strategy uses a special jurisdiction, Gelephu Mindfulness City, along with central bank barriers to limit the risk of spillover effects.

Whether this becomes a lasting model will depend less on slogans and more on the development of hydropower, disciplined management of reserves and state transparency in accounting for what it extracts, owns and sells.