History does not say whether Luxembourg rolled out the red carpet for Tshering Tobgay. The prime minister of Bhutan was on a working visit to Luxembourg on 29 January 2025, meeting again with , Luxembourg’s prime minister a decade ago and today its foreign minister (DP). But Tobgay was not the same man.
The small country of 850,000 inhabitants ("only" since the government "struck off" the million and a half Lhotshampas, an ethnic Nepali group living in Bhutan, from its statistics), wedged between the two Asian giants, smaller than Belgium and larger than Switzerland, has reinvented itself since the two men crossed paths on 29 September 2015.
It's not just the size that the foreign ministry press release indicated. "The meeting thus provided an opportunity to explore avenues for cooperation in key areas such as sustainable finance, technological innovation, sustainable development and even crafts. The importance of closer cooperation in the fight against climate change was also discussed. With this in mind, the Bhutanese delegation's working visit to Luxembourg also included interviews at the European Investment Bank and visits to the House of Startups, the House of Financial Technology, the Luxembourg City Incubator and the Luxembourg Green Exchange."
13,011 bitcoins, fourth largest in the world
In the wake of some spectacular bankruptcies of crypto champions, such as FTX in 2023, the world learned that Bhutan had embarked on massive investments in bitcoin and the cryptocurrency ecosystem in 2019, with the utmost discretion. At the end of December, this small piece of land between mountains over 7,000 metres high and bleak plains held 13,011 bitcoins, worth an estimated $780m at current prices, according to Arkham Intelligence. This puts the country in fourth place worldwide in terms of sovereign holdings of bitcoin, behind the United States, China and the United Kingdom, since these bitcoins are held in its sovereign wealth fund, Druk Holding & Investments (DHI).
Like the Norwegian fund, Bhutan's sovereign wealth fund is taking advantage of the production of green electricity, especially hydroelectric power, to develop a multi-pronged strategy. There are investments in bitcoin (and in ether and BNB), but also a partnership with Bitdeer Technologies to develop mining infrastructures that will be of interest to various players because of the price of electricity. A 100 MW mining centre is already operational, and a further 500 MW is expected to be developed this year.
Blockchain, CBDC and sandbox for fintechs
The country has also opened the door to blockchain with Polygon on the one hand and US giant Ripple on the other, to roll out a central bank digital currency. Since 2021, the local government has been aiming to promote financial inclusion via this technology, in a country where 14 currencies coexist, although the national currency, which has the same exchange rate as the rupee, is the most widespread. In September, Bhutan also set up a second sandbox for fintechs.
There's a lot of talk about finance and how to reinvent a country's economy by making the most of its green resources... which don't necessarily feed into the “gross national happiness” alternative to GDP introduced in 1972 by King Jigme Singye Wangchuck, the fourth king of Bhutan. Has the new cryptocurrency strategy erased the social problems identified up to now? Rural poverty, high youth unemployment, gender inequality and the treatment of ethnic minorities? The questions sometimes remain unanswered. Sometimes because the unemployment rate has fallen from 28.6% in 2022 to 18.9% in 2023; annual growth remains above 5%.
One thing is certain. Last Friday, Ed Sheeran became the first international pop star to perform in the kingdom. And to dine with the sovereign Jigme Khesar Namgyel Wangchuck and his wife Jetsun Pema. A certain idea of happiness.
Read the original French-language version of this news report /