Bhutan’s newly established Special Administrative Region (SAR), Gelephu Mindfulness City (GMC), has announced plans to include digital assets such as Bitcoin (BTC), Ethereum (ETH), and Binance Coin (BNB) in its strategic reserves.
According to a press release, this decision makes GMC one of the first regions globally to officially integrate digital assets into its reserve strategy. The move also builds on Bhutan’s previous involvement in Bitcoin mining.
Criteria for Strategic Reserve Assets
GMC’s approach to its strategic reserves prioritizes digital assets with high market capitalizations and deep liquidity. This ensures these assets can be traded with minimal price impact. Additionally, the region intends to recognize only assets issued on mature and secure blockchains that allow for robust monitoring of on-chain transactions.
Located at the crossroads of South Asia’s burgeoning economies, GMC aims to leverage its geographical position to promote blockchain technology. The region seeks to attract businesses and investors by embracing digital assets while enhancing its economic resilience.
Legal and Regulatory Framework
Per the release, the inclusion of digital assets in strategic reserves follows the enactment of GMC Law No. 1 of 2024, also known as the Application of Laws Act 2024.
Introduced in late December 2024, this legislation established a comprehensive legal and regulatory framework for digital asset financial services within GMC. The law aims to provide a secure environment for businesses while fostering the growth of a robust digital asset ecosystem.
Further, the SAR plans to hold a high-level meeting in March 2025 to discuss incorporating digital assets into strategic reserves. Senior officials and industry leaders worldwide are expected to attend, and an international advisory panel on digital assets is set to be established.
Bhutan’s Broader Role in Bitcoin
Notably, Bhutan has also emerged as a notable player in the Bitcoin space. In September 2024, it became the second nation, after El Salvador, to disclose Bitcoin holdings. Unlike most governments, Bhutan’s holdings result from state-backed mining operations utilizing its abundant hydroelectric resources.
At the time, Arkham research revealed that Bhutan held 13,036 BTC, valued at $770 million, accounting for nearly 27.9% of its GDP in 2023. This surpassed El Salvador’s 5,876 BTC holdings, highlighting Bhutan’s growing prominence in the global Bitcoin ecosystem.
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