United Behind the Coin

Citizens say no turning back on Digital Asset Mining; instead accelerate

When the Pay Commission presented the salary revision last week, many civil servants said it was “beyond expectations.” Understanding the health of Bhutan’s economy, they thought the revision would be meager. But everyone now knows the source: through revenue generated from digital asset mining, Druk Holdings and Investment (DHI) would be giving Nu 8 billion to the government. This and other factors have created a massive support for digital asset mining. People underline that Bhutan made no mistake by venturing into digital asset mining, which should be further strengthened and that it is about Bhutan’s economic security, economic sustainability, economic self-sufficiency, and economic innovation, apart from fulfilling the needs of the present and securing the future. 

President of the Construction Association of Bhutan (CAB) Trashi Wangyel recounts that about 15 to 20 years back, he had talked with policy makers of the need to have a fund that could be used during emergencies. “I remember talking about using our natural resources sustainably but with higher returns. Later we also spoke about digital asset mining, which was fairly new those days,” Trashi says. “I am not claiming to be an expert, but the world experienced a Black Swan Event, in the form of the Covid 19 pandemic. Though, we received support from our friends and partners, ultimately everyone has their priorities. Fortunately, our Kings, whose visions cannot be described had an emergency fund and we lived on it,” he added. According to Trashi, Bitcoin also played a very big role. “And could we have afforded the salary revision, which was really required, if we had not ventured into digital asset mining,” he questioned.

Trashi added that Bhutan will not only earn but also learn. “Our people will know about what is happening in this rapidly changing world and be ready to be part and parcel of the new world. We know the risks. In 2021, the value of Bitcoin fell from $68,000 to $17,000. This year it had gone back to above $30,000 at one point. It is business. None of Bhutan’s top business houses would have reached where they are today if they had not taken risks earlier,” he said.

Bhutan has not really been able to “derive the most” from hydropower. “This is the opportunity, and we have to seize it. Here, we are converting power to dollars,” he continued. While Bhutan has to consider global implications, at the end of the day, “you have to take care of your house.” “As long as we ensure that power used for mining is green, we have to continue what we have started,” he said, adding that there are many Bhutanese who are for crypto mining.

“What we are talking about is economic security, economic sustainability, economic self-sufficiency, economic innovation, fulfilling needs of the present and securing the future,” he said.

According to Trashi, Bhutan has been a champion of the environment. “We are mining using green energy and not fossil fuels. We are fulfilling our Constitutional mandate. Now, 52% of our forests are parks and biological corridors. We are carbon negative; so what are people concerned about,” he said.

Reiterating that he is not an expert, Trashi says he has been following this business for long. “I even bought ethereum and I am excited that we will be working as a team with Nasdaq-listed Bitdeer Technologies Group, based in Singapore, and developing a 600-megawatt mining farm for Bitcoin.”  On concerns about power, he said that Druk Holdings and Investment’s chief executive officer (CEO) had told Nikkei Asia in a recent interview that power generation had been considered in the Bitdeer agreement. Domestic requirements will receive first priority, and operations would close in winter when generation falls.

A former corporate employee says that Bhutan aspires to build a 21st-century economy. “But how can we do it? As mentioned by the Prime Minister (PM) during the question and answer session a few days back in the National Assembly, we are sandwiched between India and China and we cannot compete with them in export-oriented products. Like the PM said, we will have to be more innovative to develop, and digital asset mining is innovation,” she said. She added that Bhutan does not have oil, uranium, diamond, gold, and other resources. “Digital asset mining has come in, and I believe that it is divine intervention as we are now able to do something with the resources we have,” he said.

She further mentioned that Bhutan faces geographical constraints and connectivity challenges as a landlocked and mountainous country. “But we have green and relatively cheaper hydropower, a comparative advantage we have not been able to optimally utilize. Only then can we build an economy we can be proud of and a sustainable one.” She also said that just like her, there are hundreds of Bhutanese who are for digital asset mining. “People have understood what crypto mining is. We are in a new world, with different challenges. We have to be bold and capitalize on our strengths and opportunities,” she said. 

 She mentioned that due to the importance attached to the environment, Bhutan has had to make several sacrifices. “We had to do away with the Shingkhar-Gurgoan road. But in this case (digital asset mining), we are not constructing roads through protected areas. Neither are we mining in Phobjikha and chasing the Black Necked Cranes. Instead we are witnessing our parliament making another biological corridor, even as we speak,” she said.

Tandin Wangchuk, who has ventured into the construction industry, says Bhutan should go ahead as “we cannot miss the bus this time.” “The Covid 19 pandemic told us that ultimately we have to look after ourselves. Thus, we need to store something for emergencies. Imagine if we did not have Bitcoin; think about the state of our people,” he said, swallowing the lump in his throat. “And our civil servants would not be showing their teeth today if not for Bitcoin. Just think about more than 30,000 people who are today happy,” Tandin added.

Tandin says that critics should know that Bhutan has always taken the middle path. “At this juncture, the world should not expect us to showcase ourselves as the last bastion of many things, while we are not economically secure. Everything in the world is now about economics. Critics should know that when we are embarking on a road, we know the merits and demerits,” he said.

In 2018, CNN reported that Luxembourg, whose population is less than Bhutan, emits four times more greenhouse gas compared to Bhutan. Covering the story, CNN had said: “What tiny Bhutan can teach the world about being carbon negative.” “CNN should now write a story saying how tiny Bhutan can teach the world about sustainable digital asset mining,” he said.

Ugyen Tenzin from Thimphu