The Royal Government of Bhutan sold another tranche of Bitcoin (BTC) as prices recovered close to $102,000. The small country has previously sent out BTC for long-term holding or sale through Binance and Kraken.
The Royal Government of Bhutan’s wallets once again moved some of the mined Bitcoin (BTC), this time to unknown addresses. Druk Holdings, the country’s mining operator, still has significant reserves at 11,055K BTC, valued at over $1.16B.
The first large transfer was for 255.26 BTC, sent out to an unknown address. In the last month, the wallet originated several smaller transactions to CoinJoin addresses and other unidentified wallets.
After that, the wallet originated a transaction for 377.787 BTC, sent to an anonymous CoinJoin address. Not all BTC sent from Bhutan’s main wallet ended up liquidated, as some of the new addresses are still holding it. Some of the coins were moved for additional security, as the government’s wallets are attacked with zero-value transactions.
The destination address now holds over $26M, or 254.26 BTC, with no other connections or deposits from other wallets. The biggest storage wallet also connects to several smaller mining wallets with $180M, $216M and $19M in BTC, held as additional reserves. The long-term holding of the government extends the overall trend for miners to retain older coins, as they sit on reserves of over 1.9M BTC.
Bhutan’s holdings join those of 156 total entities with significant BTC reserves. Over 2.98M BTC are held in various types of treasuries, either legacy or newly acquired with leveraged funds.
Did Bhutan stop mining?
The two mining wallets of Druk Holdings have not received their regular rewards for a while. The last rewards from Foundry Digital were deposited six months ago. No regular inflows have come to the known wallets of the mining operation since then.
The Royal Government of Bhutan also received its last deposits from Antpool around December. At that time, the government’s wallets also started some of the most active selling, while before that, the BTC was held for over five years.
The bulk of BTC was mined during the 2022-2023 bear market when Bhutan expanded its mining facilities. Currently, mining is extremely competitive, and most companies are in the process of updating their fleets to the newest models. Without sufficient hashrate, the activity may not be profitable, even with cheap electricity.
The mining stalled when Bitcoin’s network kept increasing its difficulty to new peaks. Under unfavorable conditions, some miners may shut down. Bhutan’s mining operations have a relatively low cost after the initial outlay. However, since the country uses hydroelectric power, the operations may also need to shut down during the colder season.
Bhutan’s mining operations became more widely known in the past two years, but it turns out the country has been mining for longer, holding BTC at a lower cost basis. The government wallets started selling near local peaks, with the latest outlays at $105,554 per BTC.
The country remains the fifth largest known holder, surpassing El Salvador for now with roughly double the assets. Druk Holdings has only focused on BTC mining and has only limited ETH holdings. As the addresses keep a high profile, they have also received airdropped meme tokens and BTC dust from unknown wallets.
Is the Royal Government of Bhutan moving into DeFi?
Passively holding self-controlled BTC is seen as one of the approaches to protecting a strategic reserve. Bhutan’s wallets originated transactions to QCP Capital as a deposit to mint WBTC.
The WBTC did not move back to any known wallet of the government. WBTC can be widely used as collateral in DeFi protocols.
Bhutan’s holdings are relatively small compared to the scale of MicroStrategy, with reserves of 450K BTC. However, the country holds at the level of corporate miners and rivals some of the smaller ETFs. Sending BTC to Binance may not directly translate to selling but offers other opportunities to lock BTC for passive income.
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Source: https://www.cryptopolitan.com/royal-government-of-bhutan-moves-bitcoin-btc/