Gelephu Mindfulness City (GMC), a special administrative region in southern Bhutan, has awarded Toronto-based 3iQ Corp. a mandate to manage a portion of its bitcoin treasury, marking a shift from passive holding toward active yield generation.

According to an email from the firms, 3iQ will oversee part of GMC's BTC reserves using a low-risk, market-neutral investment approach designed to produce long-term returns. GMC declined to disclose the size of the mandate to CoinDesk, and neither GMC nor 3iQ specified the origin of the bitcoin placed under management.

A market-neutral strategy can encompass a range of techniques, including basis trades and lending. Such strategies typically yield at least 5% annually in the broader market. GMC did not indicate whether a specific approach has been chosen.

Background: The 10,000 BTC Pledge

The mandate gains significance against the backdrop of a pledge made in December by Bhutan's king, Jigme Khesar Namgyel Wangchuck, who committed up to 10,000 BTC—then valued at approximately $1 billion—as a long-term national asset for the city's development. At the time, collateralization, treasury strategies, and outright holding were all listed as options still under consideration.

The pledge has faced scrutiny for months. CoinDesk reported in May that Ujjwal Deep Dahal, CEO of Druk Holdings—the government's commercial arm—said he did not recall the last time the company sold any bitcoin, pushing back against onchain data indicating that roughly $1 billion had exited wallets attributed to the sovereign fund. That earlier report on the December pledge and the subsequent drawdown dispute have fueled ongoing questions about the status and deployment of the allocated bitcoin.

Bhutan's bitcoin reserves trace back to Druk Holdings' mining operations, which leverage the country's surplus hydroelectric capacity—a setup that has made the Himalayan nation one of the few sovereign entities known to mine bitcoin at scale. The kingdom's entry into digital asset accumulation predates the GMC pledge and has drawn comparisons to other sovereign crypto initiatives, though Bhutan remains distinctive in combining state-led mining with direct treasury allocation.

Beyond Asset Management

GMC officials say the partnership with 3iQ extends beyond treasury management. The arrangement is intended to create employment opportunities for Bhutanese youth and foster skills development in technology and finance. Specific programs are still being developed, GMC told CoinDesk. The workforce-development component aligns with GMC's broader ambition to position itself as a technology and financial-services hub within a city designed around mindfulness and sustainability principles.

The deal represents a notable evolution in how the planned city intends to handle its digital assets—moving from a hold-centric posture toward structured yield generation—while the broader questions about the size and provenance of its bitcoin reserves remain unanswered.

Source: CoinDesk