A small Asian country sitting in the Himalayas is now among the largest holders of Bitcoin in the world.

Bhutan might be occupying a small land area but it achieved a huge milestone in its cryptocurrency investments hitting $1 billion worth of Bitcoin.

Strategic Move

The landlocked Himalayan country has been increasing its presence in the crypto space by building its Bitcoin reserves. This move which analysts see as a strategic investment approach now bore positive results.

Arkham Intelligence reported that Bhutan became a major player in the cryptocurrency industry, owning $1 billion worth of BTC, an outstanding feat for such a small country.

The Royal Government of Bhutan now owns $1 Billion in Bitcoin. pic.twitter.com/y8MQdCqMDy

— Arkham (@ArkhamIntel) November 11, 2024

Analysts said that this key milestone highlighted the calculated steps taken by Bhutan’s government to diversify its economy to mitigate the impact of the COVID pandemic on its tourism sector.

According to Arkham Intelligence, Druk Holdings, the firm managing the BTC investments of Bhutan, holds 12,568 Bitcoins, firmly placing the Himalayan country as one of the premier BTC investors in the world.

Tapping Hydropower Resources For Bitcoin

Bhutan utilizes its abundant hydropower to fund its BTC investments as the country now ranked fourth among nations with crypto holdings, joining countries like El Salvador, a South American nation that declared BTC as its national currency.

BTCUSD trading at $91,005 on the daily chart: TradingView.com

Analysts said that the Royal Government of Bhutan leveraged its natural resources to steadily increase its cryptocurrency reserves, allowing it to reach this milestone. They said that the country implemented a consistent Bitcoin mining strategy by tapping its rich natural resources to keep its operational costs low.

Its rich hydropower resources help the Himalayan country sustain its crypto mining which is a major contributor to the country’s economy.

A scenic view of Bhutan. Image: Responsible Adventures

According to data, more than 25% of the country’s GDP comes from mining Bitcoin. It shows that Bhutan’s government is committed to turning cryptocurrency into an economic asset.

The country has already mined 13,011 BTC, making it a government with the biggest holding of BTC.

A Global Trend

Analysts said that the achievement of Bhutan shows a worldwide trend of many nations seeing the value of crypto as an asset. Bhutan and El Salvador are among the countries embracing cryptocurrency as a financial tool.

The firstborn cryptocurrency is gaining appeal as more countries are starting to explore the potential of BTC as part of their national reserve. One country, El Salvador, announced in 2021 that it will adopt Bitcoin as a legal tender.

Bhutan is another excellent example of a crypto adopter, but analysts said other countries can learn from Bhutan’s alternative model of hydropower-powered mining strategy.

Featured image from OneSafe, chart from TradingView

The crypto market will witness $3.98 billion in Bitcoin (BTC) and Ethereum (ETH) options contracts expire today. This massive expiration could impact short-term price action, especially as both assets have recently declined.

With Bitcoin options valued at $3.4 billion and Ethereum at $581.57 million, traders are bracing for potential volatility.

High-Stakes Crypto Options Expirations: What Traders Should Watch Today

According to Deribit data, Bitcoin options expiration involves 38,566 contracts, compared to 48,794 contracts last week. Similarly, Ethereum’s expiring options total 189,018 contracts, down from 294,380 contracts the previous week.

For Bitcoin, the expiring options have a maximum pain price of $79,500 and a put-to-call ratio of 0.85. This indicates a generally bullish sentiment despite the asset’s recent pullback. In comparison, their Ethereum counterparts have a maximum pain price of $3,000 and a put-to-call ratio of 0.92, reflecting a similar market outlook.

The maximum pain point is a crucial metric that often guides market behavior. It represents the price level at which most options expire worthless, inflicting maximum financial “pain” on traders.

Meanwhile, the put-to-call ratios below 1 for both Bitcoin and Ethereum suggest optimism in the market, with more traders betting on price increases. While the put options represent bets on price declines, call options point to bets on price increases. Taken together, this metric (put-to-call ratio) gauges market sentiment.

Traders and investors should brace for volatility, as options expirations often cause short-term price fluctuations, which create market uncertainty.

“The market could be very volatile, so trade with caution,” top Asian crypto influencer Wise Advice warned.

However, markets usually stabilize soon after as traders adapt to the new price environment. With today’s high-volume expiration, traders and investors can expect a similar outcome, potentially influencing future crypto market trends. As Bitcoin and Ethereum options near expiration, both assets could approach their respective strike prices.

This is a result of the Max Pain theory, which predicts that options prices will converge around the strike prices where the largest number of contracts — both calls and puts — expire worthless.

More Headwinds With Year-End Crypto Options Expiry

With markets still optimistic, the general sentiment is that Bitcoin’s upside potential remains viable, potentially reaching $100,000 before year-end. Nevertheless, bigger problems lie ahead, with many crypto options due for expiry at the end of the month and, potentially, even more (around $11.8 billion for BTC) on December 27. 

These dates are significant given Bitcoin bull runs tend to end precisely at the end of the year, between November and December. However, considering they only started between October and November, they have often extended into the early months of the new year. 

The expiration of these Bitcoin options at the end of the year may present as a major catalyst. It could influence immediate price action as well as the trajectory into the new year, 2025. With bulls looking at the year’s end expiration as a unique opportunity to foray into unchartered territory beyond $100,000, bears commit to limiting the price discovery to defend their positions.

“Looking at the options market, the market is clearly polarized and trading is very fragmented, with some of the larger traders heading for the sky to go long, while more traders are currently on the short side of the market,” Greeks.live shared.

Should the positioning battle intensify towards the end of the year, the fallout from these options expiring could ripple beyond December, setting new standards for Bitcoin and Ethereum.

The latest data shows that Bitcoin’s trading value has dropped by 2.46% to $87,813. Similarly, Ethereum has fallen by 5.43%, now trading at $3,053.

The Royal Government of Bhutan recently sold 367 Bitcoin, valued at approximately $33.5 million, via Binance.

Data from Arkham Intelligence shows the transaction occurred on Thursday morning when Bitcoin’s price exceeded $90,000. Since then, Bitcoin has dropped over 3% to $87,000.

Bhutan Is Still the First-largest Government Bitcoin Holder 

This sale follows a $66 million Bitcoin transaction two weeks ago, executed when BTC reached $70,000. Combined, Bhutan has liquidated nearly $100 million worth of Bitcoin in the past month.

Arkham data shows that Bhutan still holds 12,206 Bitcoin, currently worth nearly $1.11 billion. These assets are managed by Druk Holding & Investments. The government appears to capitalize on price surges, selling portions of its holdings during market rallies.

Bhutan ranks as the fifth-largest government holder of Bitcoin, trailing the United States, China, the United Kingdom, and Ukraine. Unlike other nations, which often acquire Bitcoin through asset seizures, Bhutan mines its Bitcoin, leveraging its hydroelectric resources.

Governments Continue to Benefit From the Market Rally

Much like Bhutan, several governments are looking to reap economic benefits from their Bitcoin reserves in the current market rally. El Salvador is leveraging the Bitcoin surge to buy back its national debt. 

In 2021, El Salvador became the first country to adopt Bitcoin as legal tender. Since then, the country’s BTC reserve has grown to over $515 million. The country even recently raised $1.6 billion in funding to build the first Bitcoin City. 

Bitcoin has been rapidly progressing towards mainstream adoption throughout this year. The approval of Bitcoin ETFs back in January drove significant retail investment in the cryptocurrency. There’s also a prominent regulatory shift in the US after Donald Trump’s re-election. 

Earlier today, US Republican senator Lummis proposed a bill to sell the Federal Reserve’s gold and buy 1 million BTC to boost the government’s Bitcoin reserves. 

The state of Pennsylvania also introduced a bill to allocate 10% of state funds to buying BTC. The state proposes to use Bitcoin as a hedge to combat inflation and diversify its investments.