Last week, I published a quick post about a few Bitcoin adoption events, with the Czech Republic’s central bank being the latest. In this newsletter, I’ll dive deeper, as many people aren’t aware of these adoptions happening around the world, as they often go underreported by mainstream media. So, I’ll update you on the current state of Bitcoin adoption here.
El Salvador:
El Salvador became the first country to adopt Bitcoin as legal tender in 2021, marking a historic shift in monetary policy. To strengthen its financial sovereignty, the nation established a Strategic Bitcoin Reserve, gradually accumulating BTC as a hedge against fiat instability. You can watch their Bitcoin wallet and daily buys here.
In parallel, El Salvador leveraged its volcanic geothermal energy to power zero-emission Bitcoin mining, turning natural resources into economic strength. This initiative not only secures the Bitcoin network but also transforms renewable energy into digital assets, positioning the country as a leader in Bitcoin-driven innovation. By competing with the open market for mining, El Salvador earns newly mined Bitcoin, further reinforcing its national reserve and financial independence.
Bhutan:
The Kingdom of Bhutan, known for its commitment to Gross National Happiness, has quietly embraced Bitcoin mining as part of its national strategy. Since 2019, Bhutan has been mining Bitcoin using 100% renewable hydroelectric power, turning excess electricity into a sovereign financial asset.
Through DHI, Bhutan’s state-owned investment arm, the country has accumulated approximately 13,000 Bitcoin and holds 11,600 Bitcoin today (link), making it the fourth-largest government Bitcoin holder globally (€1.1 billion). While specific wallet addresses have not been disclosed, Bhutan actively competes in the open market for newly minted Bitcoin, leveraging its renewable energy surplus to strengthen its financial reserves.
Middle East:
Middle Eastern governments are increasingly engaging in Bitcoin mining, leveraging their energy resources and developing regulatory frameworks to support the growth of the cryptocurrency sector.
The UAE is emerging as a significant hub for Bitcoin mining in the region. A notable development is the partnership between Marathon Digital Holdings and Abu Dhabi-based Zero Two to establish a $400 million Bitcoin mining facility with a combined capacity of 250 megawatts. This facility will consist of two mining sites: one in Abu Dhabi’s Masdar City and the other in Mina Zayed.
The Omani government has invested over $800 million in crypto-mining operations, signaling its commitment to becoming a key player in the Bitcoin mining sector. Additionally, Oman has developed a regulatory framework to promote the use of digital currencies, allowing businesses to utilize cryptocurrencies as payment methods and establishing a licensing system for digital currency exchanges.
Iran has recognized cryptocurrency mining as a legitimate industry since 2019, offering licensed miners cheap energy but requiring them to sell mined Bitcoin to the Central Bank. However, the country has faced challenges, including rolling blackouts, which have been partially attributed to unlicensed cryptocurrency mining operations consuming substantial electricity.
While there have been rumors of Gulf states such as Saudi Arabia, the UAE, or Qatar purchasing Bitcoin at a sovereign level, no official confirmations have been made.
Russia:
Russia has been increasingly engaging with Bitcoin across various facets, including mining, international trade, and as a potential alternative to traditional financial systems. Leveraging its abundant energy resources, Russia has become a significant player in Bitcoin mining.
State-owned entities like Rosseti, the country’s largest power grid operator, are exploring Bitcoin mining operations at underutilized power plants to optimize energy consumption and generate additional revenue.
In the face of Western sanctions, Russia has turned to Bitcoin and other cryptocurrencies to facilitate international trade. Finance Minister Anton Siluanov acknowledged that Russian companies are utilizing Bitcoin for foreign transactions, enabled by recent legislative amendments. These measures aim to circumvent sanctions and maintain trade with key partners like China and Turkey.
Back in December, Vladimir Putin even stated during a public appearance: “Who can prohibit Bitcoin? No one.”
Germany: Deutsche Telekom’s Green Bitcoin Mining Revolution.
Deutsche Telekom, Europe’s telecom giant, is pioneering an innovative approach to Bitcoin mining. Their “Digital Monetary Photosynthesis” project in Backnang, Germany, is transforming surplus renewable energy into digital value while stabilizing the power grid.
Key Points: Utilizes excess green energy that would otherwise be wasted and mobile Bitcoin mining rigs act as “flexible loads” to balance energy supply and demand.
This initiative not only reduces energy waste but also tests grid resilience and gathers valuable data for future energy-regulation projects. It mirrors successful models in the U.S. and Finland, showcasing Bitcoin mining’s potential beyond finance.
Czech Republic:
The Czech National Bank (CNB) has taken a groundbreaking step by approving a proposal to study Bitcoin as a potential reserve asset. This move, spearheaded by CNB Governor Aleš Michl, could make the Czech Republic the first European country to hold Bitcoin in its central bank reserves.
Key points of the CNB’s Bitcoin initiative:
- The bank’s board has approved an analysis to assess Bitcoin’s viability as a reserve asset.
- If implemented, up to 5% of the CNB’s €140 billion reserves could be allocated to Bitcoin, amounting to approximately €7 billion.
- Governor Michl views Bitcoin as a potential tool for diversifying the bank’s portfolio.
