Ezra Reguerra10 hours agoBhutan’s DHI to offset halving effects with Bitcoin mining upgradeDruk Holding and Investments and mining firm Bitdeer will increase their mining capacity in Bhutan sixfold before the Bitcoin halving.2036 Total views3 Total sharesListen to article 0:00NewsOwn this piece of crypto historyCollect this article as NFTJoin us on social networksThe Kingdom of Bhutan’s sovereign investment arm and its Bitcoin (BTC) mining partner, Bitdeer Technologies, will increase their BTC mining capacity to offset the potential impact of the mining rewards reduction after the Bitcoin halving.
Druk Holding and Investments (DHI), the investment arm of the royal government of Bhutan, and the Nasdaq-listed Bitdeer reportedly announced that they will invest in increasing their mining project’s capacity sixfold ahead of the halving.Bitcoin mining profitability chart for the first quarter of 2024. Source:BitInfoCharts
Bitdeer’s chief business officer said the planned upgrades will raise Bhutan’s mining capacity by 500 megawatts by the first half of 2025. This would increase the Himalayan kingdom’s total mining capacity to 600 megawatts.
The funds needed to introduce new hardware for the upgrade will be taken from the $500 million fund the duo announced last year. On May 3, 2023, the two entities announced the creation of a closed-end fund valued at $500 million.
Bitdeer chairman Jihan Wu said at the time their company would work with DHI to use Bhutan’s zero-emission energy to support blockchain technologies. Wu said that the fund would help develop international stakeholder networks that could help Bhutan’s technology sector.
Bhutan’s DHI, which manages over $2.9 billion in assets, had quietly grown a crypto portfolio before it was brought to light in the bankruptcy proceedings of crypto firms Celsius and BlockFi.
A Forbes report highlighted that the DHI placed millions in crypto and was a customer of the two bankrupt companies.
Local reports also highlighted that Bhutan has been using hydropower to mine BTC since 2019 when the price was around $5,000.
Related:Once unprofitable BTC miners are turning their machines back on — Analyst
While the two companies are preparing to offset potential losses after the Bitcoin halving, others believe that the halving of BTC rewards would not affect profitability.
Laurent Benayoun, the CEO of liquidity firm Acheron Trading, said that the mining rewards are going to be “compensated by an increase in network fees.”
BNB Chain senior solution architect Jimmy Zhao believes that Bitcoin-based nonfungible tokens could also help with miner profitability after the Bitcoin halving.
As of February 2024, crypto asset manager Grayscale estimated that Bitcoin Ordinals generated over $200 million in transaction fees for miners.
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