The Royal Government of Bhutan has sold $66 million worth of the Bitcoin it has accumulated. The sale came after its price climbed above $70,000 for a while.
According to data from Arkham Intelligence, the government had been quietly stashing BTC away in its wallet over the last few years. The report revealed that the wallet made two separate transactions on October 29, moving from part of the stashed funds.
The transactions were traced to a Binance wallet, hinting at speculations that the government is planning to liquidate on the crypto exchange.
The government still has about $800 million BTC in its wallet. Notably, whales with huge Bitcoin balances like the Royal Government of Bhutan can influence the market via sales at different prices.
Royal Government of Bhutan’s Bitcoin story
The Royal Government of Bhutan entered the Bitcoin market in 2019 after it needed to diversify its revenue. Famous as a tourist center, the country bought its first Bitcoin when it was $5,000.
It made the first investment because of the fall in tourism revenue due to the lockdown imposed around the world during the coronavirus pandemic. The tourism sector recoups an estimated $88 million annually but saw a drastic fall that year.
Helping in its push in the digital world was Druk Holding and Investments, a state arm overseeing its Bitcoin mining efforts.
Using the power from its hydroelectric power, Bhutan launched its mining operations. It is presently one of the countries using its resources to run its mining services.
The mining service enables the country to earn consistent income without taking from its foreign reserves and become a strong country for the future using tourism and energy production.
Mining investments and expansions
Bhutan increased its mining operations aggressively in 2020. The country increased the capacity of its mining centers after making deals with hardware companies abroad.
The following year, DHI already made partnerships in the crypto sector, inking deals with BlockFi and Celsius. Although the partnerships were integral, they were in secret until the issues of the lenders were revealed to the public.
Bhutan also showed commitment towards mining in 2021, after it made a massive $51 million investment into buying hardware. The figure was a big rise from the previous year when it spent about $1.1 million.
The country continued its quest in 2022, with a report stating that it splurged $142 million into the purchase of hardware. This figure accounted for 10% of its import that year. Its investment in mining shows how much the operations are integral to its economic strategy.
The country’s crypto holdings were made public in 2023 after Forbes published a report uncovering all its investments. Some of the investments included millions in digital assets and loans to firms.
Economic pressures trigger Bitcoin sell-offs
Bhutan’s Bitcoin holdings came with a lot of controversy. In the middle of 2023, the country’s foreign reserve dropped, covering about 14 months of import needs.
During the period, DHI advised that the country use its Bitcoin holdings to fund salaries, hinting that it could use crypto sales to fill gaps in public finance.
Bhutan’s crypto holdings are huge, compared to other countries in the crypto space. It has a larger cache than El Salvador, which famously became pro-Bitcoin recently, announcing it as a legal tender. El Salvador currently holds $335 million worth of the asset. With its population at 782,000, the average Bitcoin holding per citizen is more than $1,000.
The per capita figure shows the country’s commitment towards Bitcoin, making it one of the leading countries in Bitcoin investments. But the country is not holding only Bitcoin. Reports show it has about $1.5 million worth of ETH, $3 million worth of BNB, and $20,000 worth of MATIC.
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