Quick Answer
Yes, cryptocurrency is legal in Bhutan but with restrictions.
- Mining and exchanges are limited to Gelephu Mindfulness City entities.
- A government-backed system allows tourists to pay with approved cryptocurrencies.
Legal Status of Crypto in Bhutan
Cryptocurrency in Bhutan exists in a state of restricted legality, where it is officially embraced for state-led initiatives but is not openly accessible to the general population. The government is involved in Bitcoin mining and has rolled out a crypto payment system for tourists, demonstrating its legal acceptance in controlled sectors. This approach is enforced by the Royal Monetary Authority, which limits mining and exchange activities to the Gelephu Mindfulness City and restricts public crypto trading through domestic banks. General financial compliance is guided by the country's AML/CFT Regulations 2025, though they do not yet specifically address virtual assets.
Current Regulations
Bhutan’s current crypto regulations are guided by a cautious, phased approach from the Royal Monetary Authority (RMA). A formal RMA notice from April 2025 stipulates that crypto mining and exchanges are exclusively permitted for entities registered within the Gelephu Mindfulness City. This notice also reinforces the restriction on the general public using domestic banks for crypto trading. Despite these limitations, the government has launched a nationwide system allowing tourists to pay for services using approved cryptocurrencies, indicating a dual strategy of controlled adoption and economic utility.
Regulatory Authorities
Several government bodies and frameworks are involved in overseeing Bhutan's approach to cryptocurrency regulation.
- Royal Monetary Authority of Bhutan (RMA): As the central bank, the RMA is the primary financial supervisor, responsible for licensing institutions involved in crypto payments and ensuring overall financial stability. It also enforces the official regulatory stance that restricts public crypto trading through domestic banks.
- Gelephu Mindfulness City (GMC): The GMC operates under a special regulatory framework that has been designated as the exclusive jurisdiction for all legal crypto mining and exchange activities in Bhutan. Any entity wishing to conduct these operations must be registered and compliant with the rules established within this economic hub.
- Financial Intelligence Department (FID): The FID is the central agency for implementing the country's AML/CFT regulations, which are designed to prevent illicit financial flows. It is responsible for receiving and analyzing suspicious transaction reports from financial entities, a function that would apply to crypto-related transactions.
Historical Context
Bhutan’s crypto evolution began cautiously, with state-level involvement becoming public in 2023 through revelations of industrial crypto mining and a $100 million crypto sale to fund civil servant pay raises. A significant policy shift came in April 2025, when the Royal Monetary Authority formally restricted mining and exchanges to the Gelephu Mindfulness City. The following month, Bhutan launched a national crypto payment system for tourists. This initiative, aimed at boosting the tourism sector, saw rapid adoption with over 1,000 merchants joining within two months, simplifying payments for international visitors.
Compliance Requirements for Businesses in Bhutan
Businesses in Bhutan must adhere to a comprehensive compliance framework primarily outlined in the AML/CFT Regulations 2025. This framework mandates several key procedures to prevent illicit financial activities. Essential rules include:
- Anti-Money Laundering (AML) Checks: Businesses are required to conduct thorough Customer Due Diligence (CDD) before establishing a relationship or executing transactions over Nu. 300,000. This includes identifying and verifying customers and beneficial owners, prohibiting anonymous accounts, and performing ongoing monitoring of transactions. Enhanced Due Diligence (EDD) is mandatory for high-risk clients, such as Politically Exposed Persons (PEPs). Suspicious transactions must be reported.
- Know Your Customer (KYC) Requirements: Firms must verify a customer's identity using reliable, independent documents. For individuals, acceptable forms of identification include a passport, driver's license, or national ID card. Address verification can be done with recent utility bills or bank statements. The process involves not only collecting documentation but also understanding the nature of the business relationship and keeping customer information updated.
- Other Mandatory Procedures: Companies must appoint a senior-level AML Compliance Officer (AMLCO) and establish robust internal controls, including regular staff training and independent annual audits. All transaction and due diligence records must be retained for a minimum of ten years. According to compliance guidance, while businesses can rely on third-party services for due diligence, the ultimate responsibility and liability for compliance remain with the company.
Why this matters for Cross-Border Payments
For businesses in India, Bhutan's stringent AML/CFT framework creates significant hurdles for cross-border payments. Indian companies engaging with Bhutanese entities must navigate rigorous Customer Due diligence (CDD) and record-keeping mandates, which increases compliance costs and operational friction. These regulations introduce potential pain points such as transaction delays and reduced payment flexibility, as the tightly controlled crypto environment limits options for seamless international trade between the neighboring countries.
How Lightspark Enables Compliant Crypto-Native Payments
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For regulated institutions navigating frameworks like Bhutan's AML/CFT rules, Lightspark provides tools that facilitate compliance. The platform offers features such as audit-ready reporting, flexible custody options, and integrations for compliance needs like travel rule screening. While Lightspark does not manage regulatory obligations directly, its infrastructure is built to be compliant-ready, enabling businesses to integrate modern payment rails while adhering to their own stringent legal and security standards.
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Notice: This article is provided for informational purposes only and does not constitute legal advice.
Sources
- Bhandari, Bibek. "Bhutan’s big crypto tourism push aims to revolutionise Himalayan travel." South China Morning Post, 12 Jul. 2025, www.scmp.com/week-asia/economics/article/3317923/bhutans-big-crypto-tourism-push-aims-revolutionise-himalayan-travel.
- Financial Intelligence Department of Bhutan. ANTI-MONEY LAUNDERING AND COUNTERING OF FINANCING OF TERRORISM REGULATIONS 2025 (4th Edition). Financial Intelligence Department of Bhutan, 11 Jul. 2025, www.rma.org.bt/media/Laws_By_Laws/AML-CFT%20Regulations%202025.pdf.
- Kaye, John E. "Bhutan becomes first country to roll out national crypto payment system for tourists." The European Magazine, 7 May 2025, the-european.eu/story-45522/bhutan-becomes-first-country-to-roll-out-national-crypto-payment-system-for-tourists.html.
- Nessi, Lorena. "1,000+ Merchants in Bhutan Accept Crypto—Here’s Why That Matters." CCN.com, 8 Jul. 2025, www.ccn.com/education/crypto/crypto-guides/1-000-merchants-in-bhutan-accept-crypto-heres-why-that-matters.
- Royal Monetary Authority of Bhutan. "RMA’s Regulatory Stance on Crypto Currency." Royal Monetary Authority of Bhutan, 30 Apr. 2025, www.rma.org.bt/view_news/106/.
- Shamim, Sarah. "Can Bitcoin save Bhutan’s struggling economy?" Al Jazeera, 14 Apr. 2025, www.aljazeera.com/economy/2025/4/14/can-bitcoin-save-bhutans-struggling-economy.
- ShuftiPro. Bhutan - Country Wise Documentation. ShuftiPro, 22 Oct. 2019, shuftipro.com/compliances-reports/bhutan.pdf.
