. The country also imported $51 million of chips in 2021. By comparison, Bhutan custom officials recorded just $1.1 million of these chips were imported in 2020. The cost of bitcoin mining rigs tracks the cryptocurrency’s value as it swings, but industry insiders say even at 2021’s sky-high prices, this level of spending would equate to a data center the size of several football fields.
The trade data classifies the chips under the same export label used by bitcoin mining rig makers, and shows they were largely sourced from China and Hong Kong. However, it doesn’t reveal who exported and imported them. Bhutan’s Ministry of Finance that the country’s total imports soared in 2022, partially due to spending on these chips by Druk Holdings & Investment “for special projects.” Bhutanese officials did not respond to questions about how the hardware was used.a “central bank digital currency” with the exchange Ripple. But its crypto investments have largely remained a secret, even when they involved entanglements with failed companies.
China’s move to ban crypto activities in 2021, as well as moves in Kazakhstan and Sweden to limit or tax bitcoin miners, have forced many operations to find new homes with cheap sources of electricity. The United States, Norway and further flown destinations like Paraguay, which also has immense hydropower capacity, have drawn hoards of miners.
“It's no surprise that entities are mining bitcoin in Bhutan. The mountainous country has a massive hydropower capacity compared to its small population and produces a similar amount of electricity per capita as the United States — a much wealthier country,” says Jaran Mellerud, bitcoin mining analyst with Luxor. “This cheap, stranded hydropower is undoubtedly alluring for miners whose sole job is turning undervalued electricity into bitcoin.