A couple of weeks ago it was revealed that Bhutan has secretly been buying up bitcoin. This revelation came as a discovery in BlockFi's bankruptcy documents. For crypto enthusiasts it is a great news and a proof of interest in bitcoin by sovereign funds. But critics started questioning the secrecy of these actions. How these bitcoin purchases were not disclosed, and Bhutan's citizens were not made aware of these investments. How often do governments disclose all investments in details? and Why is this anybody's business?
Bhutan continues to surprise us. In the latest news it has been revealed that Bhutan has not only been buying up bitcoin but also has been mining bitcoin since April 2019. Once again the the question of secrecy of these positives moves towards bitcoin are being raised. That probably means there is no other objections or good arguments can be made against mining bitcoin or investing in bitcoin by sovereign funds. It is understandable that a country like Bhutan would like to keep their crypto ambitions secret. Majority of the governments, international bankers, and mainstream media have been publicly and loudly critical of bitcoin and crypto. IMF and World Bank have issues publications criticizing El Salvador when they adopted bitcoin as legal tender. IMF even included legal provisions in deals made with Argentina that the country shouldn't get involved in crypto. International bankers and government have been clear that bitcoin is a threat to the status quo, and they wouldn't like to see countries making monetary decision involving crypto on their own.
Sovereign countries should be able to make all financial and monetary policy decisions, taking into accounts the benefits and disadvantages, without any outside influence. It was a courageous move by El Salvador when it became the first country that made bitcoin a legal tender. We knew it wouldn't be the only country that would take similar steps towards bitcoin and crypto. Simply because the benefits bitcoin and other decentralized systems offer. One of the benefits is utilizing unique geographical locations and using renewable energy in powering bitcoin and crypto mining. Such projects can help countries build and grow their energy infrastructure and potentially lower the costs of energy for its citizens.
One of the biggest criticisms thrown at bitcoin and crypto mining has been inefficient use of energy and contributions to global pollution. These claims have been proven incorrect. Not only most of bitcoin mining relies on renewable and clean energy, the bitcoin mining system incentivizes innovation in energy and exploration of cheaper renewable energy source options. El Salvador's bitcoin mining project involves using geothermal energy from volcanos. Bhutan on the other hand uses hydroelectric plants. With its immense hydroelectric potential it only makes sense the country would take advantage of the newest technology. It looks like Bhutan will only be expanding its involvement in bitcoin mining and perhaps enter into partnership with mining companies.
I wonder how many more countries are secretly mining bitcoin or at least considering it. It would be negligence if countries or their energy departments don't review the potentials, benefits, and disadvantages of crypto mining. Countries have different geographies and one solutions wouldn't fit them all, but they all have potentials for harvesting different kinds of renewable energy utilizing different kind of infrastructure and technology. It is always expensive to explore such options and usually it requires partnering with companies who specialize in certain types of energy harvesting. Companies have funding and technology for such purposes and governments may end up getting a deal that may not be completely beneficial for them. Ability to mind crypto while building energy infrastructure may be a viable option for funding such projects.
Investing and mining are only couple of ways bitcoin may benefit many. Not only sovereign countries, but also companies. We will probably hear more and more corporate funds being involved in bitcoin investments as well in the future. Just like for countries revealing interest in crypto for companies may not be an easy thing to do. They wouldn't want to attract unnecessary attention.
I sincerely hope such ambitions would drive innovation and exploration of new ideas that countries haven't even considered before. The benefits of such actions can go beyond sound monetary policy, but benefit people in a way they couldn't have before. Bitcoin is truly revolutionary. Who is next?