Bhutan, a country often hailed as the happiest country in the world, is making headlines against for a bold new strategy: embracing Bitcoin as a pillar of national economic policy.

But in recent years, Bhutan has gone all in on bitcoin by mining millions of dollars in the world's most popular cryptocurrency, making an economic bet that almost no other country has to the same extent.

So why is the tiny country quietly becoming one of the largest state holders and miners of Bitcoin—catapulting the tiny kingdom into the top five globally for Bitcoin reserves?

Bhutan’s Bitcoin Bet

Bhutan is now tapping on its vast hydropower plant to fuel supercomputers to mine Bitcoins. This is especially during the summer months, where there is more water flow and the hydropower plants generate more power than its needed in the country.

Thus it would be a good strategic plan for the country to monetize the surplus energy that would otherwise be exported at low tariffs, says the Bhutanese Prime Minsiter Tshering Tobgay.

This strategy comes at a time when the country is struggling economically, Bitcoin mining is one of the steps the nation is taking to fight its way out of the crisis.

The country previously depended on tourism to contribute to more than 10% of the country's gross domestic product. In 2023, it brought in $334m, according to the Royal Monetary Authority, Bhutan's central bank.

Following the pandemic, Bhutan's tourism has since taken a nose-dive. In 2024, only 150,000 tourists had visited the country, the Prime Minister revealed.

This new stream of revenue generated from Bitcoin could also be used to address the problem of brain drain in the country. In recent years, Bhutan has seen a mass exodus of young educated people leaving the country for better opportunities.

In 2019, the number of civil servants quitting has also increased rapidly. But in 2023, the Bhutanese government sold $100m of cryptocurrency to channel them into the salaries of civil servants. Since then, the number of civil servants leaving their jobs has declined.

Bhutan's digital assets remain a mystery

Bhutan has not officially disclosed how much digital currency it currently holds. However, according to blockchain intelligence firm Arkham, Bhutan's Bitcoin holdings are worth more than $600m, making up about 30% of the country's GDP.

Arkham's data also showed that Bhutan holds other cryptocurrencies, including Ethereum and LinqAI, although the country's holding of these currencies is much smaller than those of Bitcoin.