In a strategic move, the Royal Government of Bhutan has sold a portion of its Bitcoin holdings, amounting to $66 million, from its substantial $900 million stash. This sale comes at a time when the cryptocurrency’s value surged past the $70,000 mark, indicating a possible profit-taking strategy by the nation.
Bhutan’s foray into the cryptocurrency market began quietly, with the government accumulating Bitcoin over the past five years through government-backed mining operations. This initiative was part of a broader economic strategy to diversify revenue streams beyond the traditional sectors of hydropower and tourism, which have been the backbone of Bhutan’s economy.
The decision to sell a part of its Bitcoin reserves is a significant one, considering the country’s Bitcoin holdings account for over 26.9% of its Gross Domestic Product (GDP) as of 2023. The revenue generated from Bitcoin mining has been instrumental in funding public projects, including a 50% salary increase for public servants in the country.
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Since 2023, Druk Holdings has been at the forefront of the country’s efforts to generate Bitcoin, diverging from the more common government strategy of acquiring digital assets through law enforcement seizures. Instead, Bhutan has focused on active mining operations, leveraging its natural resources to bolster its Bitcoin reserves.
What sets Bhutan’s strategy apart is its eco-friendly approach to Bitcoin mining. The country has capitalized on its abundant hydropower resources to power its mining operations, aligning with global trends towards sustainable blockchain practices. This has not only allowed Bhutan to increase its Bitcoin holdings significantly but has also positioned it as a leader in environmentally conscious cryptocurrency mining.
The shift from traditional sectors such as hydropower and tourism to digital assets marks a significant pivot in Bhutan’s economic strategy. By establishing several mining sites powered by hydropower, Bhutan has demonstrated a commitment to integrating new technologies into its economic framework while maintaining its dedication to sustainability.
The move to sell the Bitcoin on Binance, the world’s largest cryptocurrency exchange, suggests a well-calculated approach to liquidate a portion of the holdings at a favorable market price. The government wallet transferred the $66.5 million worth of Bitcoin in two transactions, hinting at the nation’s plans to address economic needs and potentially fund further public projects.
The impact of such a large transaction by a government entity can have ripple effects on the cryptocurrency market, often influencing prices due to the significant amount involved. Bhutan’s actions reflect a growing trend among nations to consider cryptocurrencies not just as an investment but also as a tool for economic development and diversification.
As the global financial landscape evolves, Bhutan’s engagement with cryptocurrency highlights the potential for digital assets to play a role in national economic strategies. The country’s investment in Bitcoin mining, leveraging its hydroelectric power, showcases an innovative approach to integrating new technologies into its economic framework.
This development is a clear indicator of the dynamic nature of the cryptocurrency market and the strategic maneuvers governments can employ to capitalize on digital assets. As Bhutan continues to navigate the crypto space, it sets a precedent for other nations considering similar approaches to bolster their economies in the digital age.
Vietnam Launches National Blockchain Strategy
Vietnam has taken a significant step towards technological innovation by launching its National Blockchain Strategy. This strategic move, officially promulgated by the government on October 22, 2024, under Decision No. 1236/QD-TTg, aims to position the country as a leader in blockchain technology by 2030.
The National Blockchain Strategy outlines a comprehensive plan to develop the blockchain industry within the country. It includes ambitious goals such as establishing Vietnam as a regional powerhouse in blockchain technology and creating a conducive environment for the growth of blockchain-based platforms, products, and services. The strategy envisions Vietnam leading the region in the blockchain industry by 2030, with the establishment of 20 prestigious blockchain brands and at least three blockchain testing centers or special zones in major cities to form a national network.
To achieve these objectives, the Vietnamese government has proposed five specific actions: perfecting the legal environment, developing infrastructure to form a blockchain industrial ecosystem, developing human resources for the blockchain field, promoting blockchain development and application, and enhancing research, innovation, and international cooperation.
The Vietnam Blockchain Association plays a pivotal role in this strategy, tasked with promoting the ‘Blockchain Make in Vietnam’ brand and developing blockchain platforms that are made in Vietnam. This initiative is expected to boost the country’s competitiveness and foster global collaboration.
By integrating blockchain education into universities and training institutions, Vietnam also plans to establish three national innovation centers by 2025. The strategy emphasizes applying blockchain across diverse industries, including finance, healthcare, logistics, and public services, to enhance efficiency, transparency, and competitiveness.
The key obstacles that Vietnam faces in implementing this strategy are:
Human Resources: The scarcity of blockchain experts in Vietnam is a significant hurdle. Most professionals currently in the field come from related industries, such as application and game development, rather than specialized blockchain backgrounds.
Infrastructure: There is a pressing need to develop a robust infrastructure that can support the growth of blockchain technology. Currently, new businesses have limited platforms on which to build their applications, which can stifle innovation and growth.
Policy: The legal framework surrounding blockchain is still in its infancy in Vietnam. Companies are navigating uncharted waters with policies that are yet to be fully understood and integrated into their operations.
Technology Adoption: Introducing blockchain technology across various socio-economic fields requires a population that is receptive and educated about its benefits and uses. Overcoming the technology’s novelty and integrating it into everyday use remains a challenge.
International Collaboration: While Vietnam aims to establish itself as a regional leader, it must also foster international partnerships. This involves not only attracting foreign investment but also ensuring that Vietnamese blockchain solutions are competitive on a global scale.
Vietnam’s bold move reflects its recognition of blockchain as one of the leading technology trends of the Fourth Industrial Revolution. The application and development of blockchain technology are anticipated to contribute significantly to building advanced digital infrastructure, ensuring data reliability and security, and creating a foundation for the development of the digital technology industry.
As the world moves towards a more interconnected and digitalized future, Vietnam’s National Blockchain Strategy sets a precedent for other nations to follow. It showcases the country’s commitment to embracing innovative technologies and its ambition to become a frontrunner in the global blockchain arena.