Bhutan, located in the Himalayas, has come to the fore in recent weeks with a significant amount of Bitcoin outflow from the state reserve. While the country, which has been extensively mining Bitcoin with state-supported hydroelectricity, has been making gradual sales since the beginning of the year, activity increased noticeably in March.
Rapid Melt in Bhutan’s Bitcoin Reserve
The Royal Government of Bhutan transferred 519.7 BTC ($36.75 million) to an external wallet last Wednesday. This transfer showed that the pace of sales in crypto assets rose dramatically in March, according to data tracked by Arkham Intelligence. In the last two weeks alone, the total outflow amounted to $152 million.
Last week was recorded as the period when Bitcoin outflows occurred most intensely in Bhutan’s history. While a total of nearly 72 million dollars of cryptocurrency was transferred in a week, the sale of 595.8 BTC ($44.44 million) stood out as the largest single transaction of the year.
After this, 205.5 BTC ($15.14 million) and 150 BTC ($11.14 million) were sent to external addresses. Additionally, 20.5 BTC ($1.52 million) was transferred to QCP Capital’s trading deposit address. Singapore-based QCP Capital attracted attention with three separate transfers totaling $16.6 million in a row throughout the year. It is thought that the transactions carried out with this company were made in the form of organized over-the-counter sales rather than direct sales on the stock exchange.
Reserves Decrease, Development Promises Become Difficult
BTC movements in amounts ranging from 5 to 15 million dollars were generally observed in transfers made in January and February. It was determined that the figures increased to 35-45 million dollars by March.
By the end of 2024, Bhutan’s Bitcoin portfolio peaked at approximately 13,000 BTC. This accumulation was formed by the country’s mining activities in publicly supported hydroelectric power plants for many years. Since the average cost of production is almost zero, all Bitcoins sold represent direct profit for the Bhutanese economy. Bhutan’s economy relies heavily on hydropower exports to India.
However, with sales accelerating since October, the amount of BTC held has dropped significantly. It was stated that with the latest transactions, the state’s balance decreased to 4,453 BTC, which is approximately 315 million dollars in market value. There has been a 66 percent decrease in total stock since the peak. In the same period, the total value of the portfolio decreased from 1.88 billion dollars to 315 million dollars with the decline in Bitcoin price.
In December 2024, the Bhutanese government committed up to 10,000 BTC to finance the new Gelephu Mindfulness City project. This amount corresponded to approximately 860 million dollars at that time. However, the total amount of BTC currently held by the state has dropped below 4,500. Under these circumstances, it does not seem mathematically possible to realize the first announced commitment with existing reserves.
The government’s commercial arm, Druk Holding & Investments, has not made any statements regarding the latest transfers and the current status of the commitment made for Gelephu Mindfulness City.
