- Bhutan plans to leverage its hydropower resources to develop green cryptocurrency, aiming to boost its economy and reduce youth emigration.
- The country’s sovereign wealth fund has been investing in cryptocurrencies since 2019 and has used profits to fund government salaries for two years.
- Officials aim to increase hydropower capacity from 3.5 to 15 gigawatts over the next 10-15 years to support their vision of becoming the “capital of green digital currencies.”
Bhutan is exploring the creation of green cryptocurrency using its abundant hydropower resources as a strategy to strengthen its economy and create jobs, according to Parminder Singh Dhugyal, chief executive of the country’s sovereign wealth fund. This initiative aims to address the growing exodus of young, educated citizens while capitalizing on the nation’s clean energy advantage.
Green cryptocurrencies refer to digital currencies mined using renewable energy sources such as hydropower rather than fossil fuels. Ujjwal Dahal, CEO of Druk Holding and Investments Ltd, emphasized this environmental benefit on Tuesday, stating: “Every digital coin that we mine using hydropower in Bhutan offsets the coin that is mined using fossil-fuels.”
The Himalayan kingdom, positioned between India and China, has already generated significant returns by investing in popular cryptocurrencies. These investments, which began in 2019, have been successful enough that the profits helped fund government salaries for the past two years, according to officials cited by Reuters.
Strategic Economic Development
Bhutan’s cryptocurrency strategy forms part of a larger economic vision that aligns with the country’s unique Gross National Happiness Index (GNH), which measures prosperity through factors beyond traditional GDP metrics, including emotional well-being and recreation. Officials are examining whether major corporations might purchase Bhutan’s green coins to help meet their environmental, social, and governance (ESG) targets.
“We are a country that runs on hydropower,” Dahal noted, suggesting that a Bhutanese coin would make a positive contribution to green economics. The initiative would use the country’s clean hydropower to run the energy-intensive computers required for cryptocurrency mining and blockchain operations.
Addressing Youth Emigration
The country of 800,000 people faces a significant challenge with youth emigration. Government data shows more than one-tenth of young Bhutanese left the country between 2022 and 2023, with youth unemployment projected to reach 16.5% by 2024. Dahal believes that developing blockchain and AI technologies could create much-needed employment opportunities to retain talent.
Analysts point out that Bhutan’s ambitious goal to become a green digital currency hub depends on substantial expansion of its hydropower capacity. The current capacity stands at 3.5 gigawatts, but the country would need to reach 33 gigawatts to fully realize its vision. Dahal outlined a more immediate target: “We plan to generate 15 gigawatts within the next 10-15 years.”
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