A very… high-end investment is planned by Bhutan’s investment arm and Nasdaq-listed Bitdeer Technologies Group as they seek investors for a fund worth up to $500 million that will be used to develop “green” bitcoin mining in the Himalayan kingdom.
Fundraising from institutional investors will begin in late May and the goal is to create carbon-free mining that harnesses Bhutan’s abundant hydroelectric power, according to a statement on Wednesday.
Mining is the least risky way for Bhutan to tap opportunities and for now the country will focus on bitcoin, Ujjwal Deep Dahal, managing director of investment arm, Druk Holding & Investments, said in an interview.
“It is important for us to look at low-volume, high-value or digital assets for that matter and try to position ourselves in a way to be globally competitive over time to build our economy,” Dahal said.
Economic Strategy
As reported in a Bloomberg report, forest-clad Bhutan, located between China and India, has a population of about 777,000 and has long sought to diversify an economy based on hydroelectricity revenue.
Druk manages the government’s investments in traditional sectors such as equities, bonds, technology, energy and real estate, as well as crypto-mining and investments under what it calls a “strategy for the future”.
Bitcoin miners struggle to solve complex mathematical puzzles using computing devices that “thirst” for energy in return for a supply of crypto. This has led to criticism of the environmental impact when “dirty” fuels provide the power.
Miners have been squeezed by the collapse in digital asset prices, increased energy costs and increased competition last year. Conditions have improved in 2023 amid a market recovery.
Singapore-based Bitdeer, owned by Chinese entrepreneur Jihan Wu, is one of the leading cryptocurrency miners in terms of computing power and has one of the largest centers in Texas. The company began trading on Nasdaq last month after a long-delayed merger with a SPAC that eventually closed.
Construction timeline
Bitdeer expects to install the 100-megawatt operation in Bhutan, with construction scheduled to begin in the second quarter and be completed in July to September.
The company and Druk will also invest in the planned new fund, Bitdeer CEO Matt Linghui Kong said in an interview.
Druk ventured into cryptocurrency mining with a “sandbox” approach when bitcoin was around $5,000, Dahal said. It also had some investments with the now-bankrupt US digital asset lenders BlockFi and Celsius Network, although they were a small part of Druk’s portfolio and have been “settled”, Dahal added.
Bitcoin surged to a record high of nearly $69,000 in the rally at the time of the pandemic that peaked in 2021. The biggest digital asset then dipped below $16,000 in 2022, but has since recovered to around $28,500.
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