Bhutan Sells Nearly 60% of Its Bitcoin Reserves, Realizing Huge Profits from Zero-Cost Mining

The Himalayan kingdom of Bhutan had quietly built one of the world's most unique sovereign Bitcoin reserves, primarily sourced from crypto mining using surplus hydropower. Since its peak in late 2024, the country's Bitcoin holdings have decreased from approximately 13,000 BTC to the current 5,400 BTC, a drop of 58%. With Bitcoin's price falling from around $119,000 to $69,000, the market value of its reserves has shrunk from $1.5 billion to approximately $374 million, a cumulative loss of over $1.1 billion in value. Since 2026, Bhutan has cumulatively sold $42.5 million worth of Bitcoin, with approximately $30.7 million of transactions completed in February alone. Individual transaction sizes were concentrated between $5 million and $10 million, forming a clear pattern. On March 9, Bhutan again transferred 175 BTC (approximately $11.85 million) to the same address. The transaction flow closely matches the over-the-counter (OTC) addresses of institutions such as QCP Capital and Binance, indicating that it is adopting a structured OTC sales strategy with low market impact, rather than a public market sell-off.

The key is that almost all of Bhutan's Bitcoin was obtained at "zero cost." Its mining relies on the country's surplus hydropower, with electricity costs far below market levels, even considered zero marginal cost. This means that every Bitcoin sold is a realization of pure profit. Even with the current price far below its historical high, the return on investment for Bhutan is still extremely considerable—as long as the Bitcoin price is higher than the marginal cost of hydropower (which can be as low as several thousand dollars), it has already achieved excess returns. This context also highlights that its sales are not forced sell-offs due to a shortage of funds, but rather a rational profit realization by a sovereign wealth fund on high-return assets. It is worth noting that in late 2025, Bhutan pledged to use up to 10,000 BTC to support the construction of the "Gelephu Mindfulness City," a national-level digital economy pilot zone. Theoretically, it should hold a large amount of reserves for the long term. However, the current holding of 5,400 BTC is significantly lower than this target, raising market speculation about adjustments to the use of funds or changes in the project's pace. Future developments remain to be seen.