The tiny Himalayan country of Bhutan, which in 1999 became one of the very last in the world to allow internet access, is now making what is perhaps Asia’s boldest foray into the risky world of cryptocurrency.
For decades, Bhutan’s development was limited by physical geography — almost 99 per cent of its territory is covered by mountains and hills. But since the 1970s, the isolated kingdom has used its geography to its advantage by constructing numerous hydroelectric power plants along its glacial rivers, giving it enough electricity for its own use and for export.
Now, Bhutan plans to use its cheap, abundant power to mine Bitcoin — an extremely energy-intensive process requiring special computers and technology to solve complicated mathematical problems — and invest the profits in the country’s development.
Bhutan’s sovereign wealth fund, Druk Holding and Investments (DHI), last week announced a $500 million partnership with a Singapore tech company, Bitdeer, to mine Bitcoin in the country for sale abroad.
"The partnership with Bitdeer to launch a carbon-free digital asset mining datacentre represents an investment in a more connected and sustainable domestic economy, helping ensure we are at the forefront of global innovation,” DHI chief executive Ujjwal Deep Dahal said.
Bhutan is not known as a tech-savvy nation. While internet coverage is now at 85 per cent of the country's 795,000 citizens, its tech industry is nascent, according to Tshering Cigay Dorji, the former chief executive of Thimphu Tech Park, the country’s only major IT hub, which hosts about 600 workers and a handful of companies servicing international clients.
More than half of Bhutan’s population still work in agriculture and the country is one of nine Asian countries categorised by the United Nations as a Least Developed Country.
“The problem is that while Bhutan has this very romantic, Shangri-la type image in the west, the ground reality is that we are still one of the least developed countries and economic self-sufficiency has always been our ultimate aim,” said Tenzing Lamsang, the editor of The Bhutanese, the country’s largest private newspaper.
Under Bhutan's Wangchuk dynasty, the country's focus has been on boosting Gross Domestic Happiness rather than financial gain. But the royal family's decision to increasingly cede power to elected officials in recent years has led to better policy decisions regarding the economy.
The abundant power from hydroelectric plants was used to drive new domestic industry, including forestry and mining, as well as being exported to neighbouring India.
The poverty rate declined from 36 per cent in 2007 to 9 per cent in 2019, according to the World Bank.
“We don’t have much land for large-scale industry and we can’t compete with China and India when it comes to services. But, what we do have is extensive hydropower – the cheapest in the world,” Lamsang said.
Bitcoin is part of a fourth economic industrial revolution in Bhutan. Cryptocurrency is a low-hanging fruit for us and we can use the proceeds to get into AI, robotics and machine learning
Tenzing Lamsang,
editor, The Bhutanese
“Bitcoin is part of a fourth economic industrial revolution in Bhutan. Cryptocurrency is a low-hanging fruit for us and we can use the proceeds to get into AI, robotics and machine learning.”
News of the state's Bitcoin venture has been greeted with a mixture of excitement and suspicion in Bhutan, given the unfamiliarity with the concept of cryptocurrency and the fact that $500 million is a huge investment for an economy the size of Bhutan’s size – the International Monetary Fund puts GDP at $2.6 billion, which ranks the country 178th in the world.
Last year, there was also public anger after it emerged the DHI had secretly borrowed millions of dollars from cryptocurrency lenders BlockFi and Celsius, with the news coming out only after both companies went bankrupt.
The press statement from DHI and Bitdeer said the money would be used to construct data centres for mining and to acquire necessary technology, as well as for investment in renewable energy sources.
The National approached DHI, Bitdeer and the Bhutanese Finance Ministry for comment but did not receive a response
Cryptocurrency experts say that the deal will be lucrative for Bhutan and will lead to further opportunities in financial services.
“I see it as a smart strategy. It’s better for Bhutan to sell Bitcoin, a finished product, rather than energy as a raw material, because it will fetch the country much higher returns. Exporting raw power to neighbouring countries can involve significant infrastructure costs,” said Nischal Shetty, the co-founder and chief executive of WazirX, one of India’s largest cryptocurrency trading platforms.
“Bringing in Bitcoin mining will also allow Bhutan to tap into new markets globally and allow the country to begin to develop more and more financial technology.”
The major concern, however, comes from fluctuation in the price and demand for cryptocurrency. In 2018, the price of cryptocurrencies collapsed by more than 80 per cent between January and December.
Bitcoin reached an all-time high of $65,000 in 2021 but plummeted to $6,200 after the start of the war in Ukraine in February last year. It has recovered to about $27,000 since then.
JPMorgan, the American financial services company, estimates it costs $13,000 to mine one Bitcoin, a process that can take anywhere between an hour and several months, depending on user experience and available software.
Bitcoin’s advocates say it is the currency of the future. It offers user anonymity and transparency and avoids third-party involvement, such as from a government, while cross-border transfers are cheaper.
Still, uptake is slow. According to a 2021 World Economic Forum study, only 6 per cent of American citizens owned cryptocurrency and the rate was even lower in Japan, Germany and Russia.
At least 42 countries have outright bans or de facto limits in place, including China, Saudi Arabia and Indonesia. India has proposed an outright ban.
There are also concerns over the long-term viability of cryptocurrency. Already, the energy used to mine Bitcoin annually is greater than the amount Norway uses in one year.
“At the end of the day, volatility will always exist with any currency,” Mr Shetty said. “And, Bitcoin and other cryptocurrencies are far more volatile – it’s hard to say how they will behave in the future.”
Labour dispute
The insured employee may still file an ILOE claim even if a labour dispute is ongoing post termination, but the insurer may suspend or reject payment, until the courts resolve the dispute, especially if the reason for termination is contested. The outcome of the labour court proceedings can directly affect eligibility.
- Abdullah Ishnaneh, Partner, BSA Law
How does ToTok work?
The calling app is available to download on Google Play and Apple App Store
To successfully install ToTok, users are asked to enter their phone number and then create a nickname.
The app then gives users the option add their existing phone contacts, allowing them to immediately contact people also using the application by video or voice call or via message.
Users can also invite other contacts to download ToTok to allow them to make contact through the app.
World Cup final
Who: France v Croatia
When: Sunday, July 15, 7pm (UAE)
TV: Game will be shown live on BeIN Sports for viewers in the Mena region
Learn more about Qasr Al Hosn
In 2013, The National's History Project went beyond the walls to see what life was like living in Abu Dhabi's fabled fort:
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The biog
Simon Nadim has completed 7,000 dives.
The hardest dive in the UAE is the German U-boat 110m down off the Fujairah coast.
As a child, he loved the documentaries of Jacques Cousteau
He also led a team that discovered the long-lost portion of the Ines oil tanker.
If you are interested in diving, he runs the XR Hub Dive Centre in Fujairah
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Director: Mohamed Sammy
Starring: Mohamed Ramadan, Ayad Nasaar, Mohamed Adel and Sabry Fawaz
2 stars
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Engine: four-litre V6 and 3.5-litre V6 twin-turbo
Transmission: six-speed and 10-speed
Power: 271 and 409 horsepower
Torque: 385 and 650Nm
Price: from Dh229,900 to Dh355,000
Studying addiction
This month, Dubai Medical College launched the Middle East’s first master's programme in addiction science.
Together with the Erada Centre for Treatment and Rehabilitation, the college offers a two-year master’s course as well as a one-year diploma in the same subject.
The move was announced earlier this year and is part of a new drive to combat drug abuse and increase the region’s capacity for treating drug addiction.
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Learn more about Qasr Al Hosn
In 2013, The National's History Project went beyond the walls to see what life was like living in Abu Dhabi's fabled fort:
Our legal consultants
Name: Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
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How being social media savvy can improve your well being
Next time when procastinating online remember that you can save thousands on paying for a personal trainer and a gym membership simply by watching YouTube videos and keeping up with the latest health tips and trends.
As social media apps are becoming more and more consumed by health experts and nutritionists who are using it to awareness and encourage patients to engage in physical activity.
Elizabeth Watson, a personal trainer from Stay Fit gym in Abu Dhabi suggests that “individuals can use social media as a means of keeping fit, there are a lot of great exercises you can do and train from experts at home just by watching videos on YouTube”.
Norlyn Torrena, a clinical nutritionist from Burjeel Hospital advises her clients to be more technologically active “most of my clients are so engaged with their phones that I advise them to download applications that offer health related services”.
Torrena said that “most people believe that dieting and keeping fit is boring”.
However, by using social media apps keeping fit means that people are “modern and are kept up to date with the latest heath tips and trends”.
“It can be a guide to a healthy lifestyle and exercise if used in the correct way, so I really encourage my clients to download health applications” said Mrs Torrena.
People can also connect with each other and exchange “tips and notes, it’s extremely healthy and fun”.
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Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
