Bhutan, the isolated Himalayan kingdom, has been quietly investing millions of dollars in cryptocurrencies, including Bitcoin and Ether, over the past year.
Reporting from Beincrypto, Wednesday (18/4/2023), this became known after Forbes reviewed the bankruptcy filings of crypto companies BlockFi and Celsius and found state-secret crypto portfolios.
Forbes found Druk Holding & Investments (DHI), a USD 2.9 billion or R 43.1 trillion equivalent of Bhutan's sovereign investment unit (assuming an exchange rate of IDR 14,884 per US dollar), was a customer of the two bankrupt crypto lenders.
Bhutan has never publicly disclosed investments by DHI. Its content raises questions about Bhutan's relationship with the crypto economy. Whether ownership supports recent and ongoing modernization initiatives in Bhutan is unclear.
In February 2022, DHI agreed to borrow USD 30 million or the equivalent of IDR 446.2 billion USDC from BlockFi but failed to repay the loan. Requested BlockFi lawyers to serve complaints to DHI last month.
Even after the lender liquidated the collateral of 1,888 bitcoins, there was still an unpaid balance of USD 820,000 or equivalent to IDR 12.1 billion.
DHI CEO Ujjwal Deep Dahal told Forbes he had no comment as the issues with BlockFi had been resolved.
"We are unable to comment due to confidentiality," Dahal told Forbes by email.
Several months earlier, DHI was also known as Celsius' institutional customer. The company made a lot of trades between April and June 2022, depositing, withdrawing and borrowing Bitcoin, Ether, Tether and several other cryptocurrencies.
It's not clear where these funds come from or how officials use them. But the DHI holdings could trigger further legal action as Celsius' attorneys have noted their intent to seek "clawbacks" from deposits made within 90 days of his bankruptcy.