Bhutan’s Royal Government has been traditionally known to accumulate many digital assets quietly but have now decided to make a change. All of a sudden, the country has transferred $22.4M USD in Bitcoin from their sovereign wallets to an unknown address and is now attracting attention from on-chain analysts. The liquidations come as the country’s crypto war chest faces a steep decline, plummeting from a peak valuation of $1.4 billion to approximately $412 million today.
DHI, Bhutan’s sovereign investment authority, is responsible for conducting regular, and periodically scheduled, capital outflow transactions. Historically, as a consistent long-term holder of diamonds since 2019, these activities by DHI indicate a move away from their past behaviour of strict “diamond hand” holding as a result of an extended period of time of weak performance on the diamond market.
The QCP Capital Connection
Arkham Intelligence, a Blockchain analysis platform, confirmed the sales with two important transactions that removed $80 million from the government’s well-known wallets. The first outflow involved 184.03 BTC, valued at roughly $14.09 million. Just five days earlier, another 100.82 BTC, worth $8.31 million, was moved on-chain.
To be clear, the second transfer can be tied directly back to deposit addresses associated with Singapore-based QCP Capital, one of the major institutional market makers.
In comparison to depositing directly onto a retail exchange (such as QCP Capital), sending money to an OTC (over-the-counter) desk suggests there is a strategy behind this transaction by using the services provided by QCP. Institutions generally use a market maker to accomplish block trades and avoid crashing the spot price. Thus, without a doubt, Bhutan intends to liquidate his positions in an orderly fashion instead of panicking.
From Peak to Trough
Bhutan cut back on their holdings significantly and as a result there has been a massive decrease in the value of its portfolio. As per on-chain reports, DHI’s value in digital assets has now reduced to only approximately $412 million or a 70% reduction from the previous value of $1.4 billion at the top of the last bull market during late 2024 and throughout 2025. DHI’s portfolio mainly consists of 5,700 BTC and some very minimal holdings in ETH and other tokens. Part of the significant decline is due to price depreciation of BTC; however, the primary drive behind DHI’s holdings decrease has come from excessive active selling. Data provided by Arkham indicates that Bhutan was actively engaged in large volume selling throughout the dates 09/15/2025 to 09/30/2025 with over $50 million per sale being done in multiple tranches date throughout this time frame. The current sale at $22.4 million per sale is therefore a much smaller volume, suggesting that liquidation is beginning to decrease.
Powered by Water
Bhutan’s entry into the crypto market is unique among sovereign states. Unlike El Salvador, which purchased Bitcoin using treasury funds, Bhutan generated its wealth through “green” mining. Since 2019, the nation has leveraged its immense hydroelectric potential—fueled by glacial rivers—to power mining data centers.
As a result of this plan, DHI was able to obtain Bitcoin, essentially at a fraction of what it would cost to buy on the open market. According to Arkham, approximately $765 million dollars in net income has been produced by the mining industry of the nation, after taking into consideration the total energy costs which are about $120 million. By monetizing stranded renewable energy that could not easily be exported to neighbors like India, Bhutan turned its geography into a digital gold mine.
The Halving Hangover
The economics of mining have changed significantly since the Bitcoin halving in April 2024, which halved the block reward, effectively doubling the cost of production for miners. For Bhutan, it meant the “free money” of the last cycle was over.
Most of Bhutan’s current treasury appears to have been mined before the 2024 halving. Since then revenue has reportedly decreased due to compressed margins, so it seems the transition from accumulation to liquidation was a pragmatic choice to take advantage of profits made in the pre-halving era instead of investing into energy-intensive mining operations which will yield lower returns.
A Sophisticated Sovereign Strategy
Overall, Bhutan has demonstrated its sophistication as a participant in the digital asset marketplace, even through the recently reported sell-off. Transaction history indicates continuing relationships between DHI and dominant international exchanges. To date, DHI’s total historical activity comprises approximately $261 million transacted via Binance (68% of total) and $118 million transacted via Celsius Network (which is now defunct). As illustrated by the inclusion of cryptocurrencies in the sovereign wealth fund structure, Bhutan is now among a limited number of countries (along with China and the United States) that have both an ownership interest in the crypto economy. However, unlike the U.S., which largely holds seized assets, Bhutan’s stash is self-made. Whether this week’s sale represents a final capitulation or merely a portfolio rebalancing remains to be seen, but it is clear that the Dragon Kingdom is no longer content to just hold.
