Druk Holding and Investments (DHI), the investment arm of the royal government of Bhutan, has partnered with Bitdeer Technologies to enhance their Bitcoin mining capacity in response to the impending reduction in mining rewards due to the Bitcoin halving. The two entities have decided to invest in increasing their mining project’s capacity sixfold before the halving.

Bitdeer’s chief business officer revealed that the planned upgrades aim to elevate Bhutan’s mining capacity by 500 megawatts by the first half of 2025, which would result in a total capacity of 600 megawatts for the Himalayan kingdom.

The necessary funds for the introduction of new hardware as part of the upgrade will be sourced from a $500 million fund established by DHI and Bitdeer last year. This fund was created on May 3, 2023, to develop sustainable mining operations utilizing Bhutan’s zero-emission energy.

The intention is for the collaboration between Bitdeer and DHI to leverage Bhutan's vast energy resources to enhance blockchain technologies, while also fostering international network connections that could benefit Bhutan's technology sector.

Despite growing concerns about potentially reduced profitability following the Bitcoin halving, with some experts predicting that network fees will increase to compensate for mining rewards, others have suggested that Bitcoin-based nonfungible tokens (NFTs) could contribute to miner profitability post-halving. Grayscale reported that Bitcoin fees have generated substantial earnings for miners, indicating continued opportunities in the crypto mining sector.

Even as Bhutan's DHI and Bitdeer take steps to improve their Bitcoin mining capabilities, the broader crypto community is considering various strategies to mitigate the impact of the halving on mining profitability.