Gelephu Gets Royal Approval for Central Bank With Power to Hold Cryptocurrency

A new central bank for Bhutan's special region

Gelephu Mindfulness City announced royal approval on November 2, 2026, to turn its financial regulator into an autonomous central bank with permission to invest in cryptocurrencies alongside traditional reserve assets. The decision gives the special administrative region in southern Bhutan a broader financial institution as it develops plans backed by a pledge of up to 10,000 Bitcoin.

King Jigme Khesar Namgyel Wangchuck signed the decree granting central banking powers to the Gelephu Financial Services Office, which will become the Gelephu Central Bank. Its responsibilities will include monetary policy, foreign reserve management, financial stability and supervision of financial institutions operating within Gelephu Mindfulness City, known as GMC.

The cryptocurrency authority is permission to invest, rather than an instruction to buy. The decree sets no fixed allocation and requires no purchase of Bitcoin or any other token. The practical decisions about how much cryptocurrency to hold, how to protect it and when it could be used will depend on the bank's reserve policies.

GMC's plans already extend beyond owning digital assets. Bhutan has connected Bitcoin generated through its hydropower resources to the city's development, while GMC has appointed an external investment manager and licensed businesses providing cryptocurrency trading and custody services. The central bank brings those activities into a wider framework that also covers conventional finance.

What powers will the bank have?

The Gelephu Central Bank will combine the regulator's existing supervisory work with functions normally associated with a central bank. Alongside managing reserves and monetary policy, it will oversee payment and settlement systems, provide liquidity support when necessary, and support the development of money and capital markets.

Payment and settlement systems are the arrangements that move money between people and institutions and complete transactions. Liquidity support means making funds available when an institution needs money to meet immediate obligations. Money and capital markets allow institutions, businesses and governments to obtain financing over different periods.

These responsibilities make the change broader than a cryptocurrency investment decision. A financial regulator primarily sets and enforces rules for firms. A central bank also takes responsibility for parts of the financial system that those firms depend on, including the movement of money and the availability of funds.

Reserve management will require particular care because the bank's permitted investments include assets with very different characteristics. Reserves are assets held to support an institution's financial responsibilities. For a central bank, being able to access funds when needed matters alongside the prospect of earning a return.

Where does Gelephu fit within Bhutan?

GMC covers more than 4,046 square kilometres in southern Bhutan, bordering India's Assam state. Established by Royal Charter in February 2024, it operates under a framework described as "One Country, Two Systems," with executive and legislative autonomy and an independent judiciary separate from Bhutan's national government.

The new bank's mandate serves that special region. Bhutan's national central bank, the Royal Monetary Authority, remains a separate institution. Keeping those two institutions distinct is essential to understanding which authority has received the new powers and where those powers apply.

Finance and digital assets are among GMC's priority industries. Its regulator already oversees traditional financial services and virtual asset businesses, so the central bank transition builds on an existing licensing system rather than starting with an empty financial sector.

For businesses considering operations in Gelephu, the change adds an institution responsible for financial stability and market infrastructure alongside business supervision. For Bhutanese residents, the development plans connect financial activity with intended jobs, training and investment in the city.

How the reserve plans developed

GMC's interest in cryptocurrency reserves began before the royal decree. In January 2025, it identified Bitcoin, Ether and BNB as assets it intended to recognise as strategic reserves. Its selection criteria favoured assets with large market values, sufficient trading liquidity and established, secure blockchain networks.

Liquidity describes how easily an asset can be bought or sold without causing a large change in its price. GMC also favoured blockchains that allow transactions to be monitored. A blockchain is a shared digital record of transactions; monitoring that record can help institutions track movements involving their assets.

The main steps show how the reserve strategy, development funding and institutional changes have progressed:

• February 2024: GMC was established by Royal Charter.
• January 2025: GMC named Bitcoin, Ether and BNB in its strategic reserve plans.
• December 2025: Bhutan announced a Bitcoin Development Pledge committing up to 10,000 BTC to support GMC's development.
• July: GMC appointed Canadian digital asset manager 3iQ to manage a mandate backed by part of its Bitcoin treasury.
• August 6: 3iQ published an interview describing its objectives for the mandate.
• November 2, 2026: GMC announced royal approval for the central bank transition.

The January reserve criteria and the November decree address different decisions. The earlier policy identified the kinds of assets GMC wanted to recognise. The decree gives the new central bank authority to include digital assets within its reserve portfolio, alongside its other central banking responsibilities.

What the 10,000 Bitcoin pledge involves

Bhutan's Bitcoin Development Pledge committed up to 10,000 BTC to support GMC over the long term. The initiative connects the country's mining operations powered by hydroelectricity with ambitions to create jobs, develop technical skills and generate economic activity.

GMC describes its Bitcoin reserve as the result of converting surplus hydropower into digital assets. Bitcoin mining uses computing equipment and electricity to help maintain the network, with miners receiving Bitcoin rewards. In Bhutan's case, the stated source of electricity is hydropower.

The origin of those holdings gives the development programme a different starting point from government cryptocurrency portfolios accumulated through criminal seizures. Bhutan's approach links an energy resource to a financial asset that can be held or deployed for development.

The pledge included consideration of collateralisation, investment strategies seeking returns while managing risk, and arrangements for holding Bitcoin over the long term. Collateralisation means pledging an asset as security for borrowing. It can provide access to financing while retaining ownership, although falling asset prices can create demands for more collateral or repayment.

Capital preservation, oversight and transparency were identified as governing principles. Those priorities matter because the programme seeks to use Bitcoin for public benefit while protecting the value available for future development. Borrowing against Bitcoin, earning returns from it and simply holding it each create different risks and access to funds.

What 3iQ is expected to do

GMC appointed 3iQ in July to manage a dedicated mandate backed by an undisclosed portion of its Bitcoin treasury. The agreement also committed the Canadian digital asset manager to establishing a lasting presence in Gelephu, investing in Bhutanese talent and transferring investment management knowledge.

Matteo Dante Perruccio, 3iQ's chief strategy officer, described the company's responsibility in an interview published by 3iQ on August 6. Alongside protecting the assets, he said the mandate aimed to help:

accumulate more Bitcoin for deployment into the project and the development of GMC.

The appointment therefore combines asset management with an intended local skills programme. Its development value depends partly on the management of the treasury and partly on whether Bhutanese professionals gain experience that can support financial operations in Gelephu.

3iQ is controlled by Nasdaq listed Coincheck Group, which completed the acquisition of a 99.8% beneficial interest in the company in February. The corporate connection places the GMC mandate within a larger international digital asset business.

The treasury arrangement and the central bank's reserve authority have related purposes but different responsibilities. Managing an investment mandate involves pursuing agreed objectives for designated assets. Central bank reserve management must also account for the institution's obligations to financial stability, liquidity and the operation of the financial system.

Which businesses are already regulated?

GFSO guidance places traditional financial services and virtual asset activities under the Financial Services Act 2025 and supporting rulebooks. Firms conducting regulated activities must obtain a financial services licence before beginning business in GMC.

The regulator's public directory lists custody permissions for Matrix Gelephu, DK and Ceffu Digital. Custody means safeguarding assets for customers. For cryptocurrencies, that includes protecting the digital credentials needed to access and transfer holdings, making operational security a central part of the service.

BTSE Exchange is authorised to operate a multilateral trading facility and provide custody. A multilateral trading facility brings together buying and selling interests from multiple participants under a set of trading rules.

The combination of trading and custody permissions gives GMC a regulated base for digital asset activity. The Financial Services Act provides a common legal framework for conventional finance and virtual assets, while individual permissions define what a particular business may do.

Why the transition needs specialist staff

GMC is recruiting more than 50 Bhutanese and international professionals for the central bank transition. The roles span virtual asset supervision, anti money laundering work, banking operations, technology, regulatory policy and macroeconomics.

The range of jobs reflects the bank's combined responsibilities. Staff supervising cryptocurrency businesses need to understand custody and digital transactions. Banking and payments staff need to manage operational reliability. Macroeconomists examine conditions across the economy that influence monetary policy and financial stability.

Anti money laundering work focuses on detecting and preventing attempts to move or disguise proceeds from crime. That responsibility sits alongside the technical ability to monitor blockchain transactions and the legal authority to supervise licensed firms.

For Bhutanese applicants, recruitment and the training commitments in the 3iQ agreement offer two routes into the city's planned financial sector. The central bank needs public sector supervisory skills, while the investment mandate is intended to build asset management experience.

What decisions are still outstanding?

The decree provides a route for GMC to introduce its own currency, including a digital version, subject to the King's concurrence. A currency issued by the region would serve a different purpose from Bitcoin held as an investment: the former would be money issued under public authority, while the latter would remain an asset in a portfolio.

GMC has not publicly set out a timetable for the central bank transition or its coordination arrangements with the Royal Monetary Authority. It has also not disclosed a cryptocurrency allocation for the new bank, the quantity of Bitcoin assigned to 3iQ, or a date for introducing a currency.

The next practical steps concern reserve policies, custody, liquidity and accountability. Those decisions will determine how the bank protects assets, meets demands for funds and explains its management of public resources. They will also shape how GMC connects its existing Bitcoin plans with the broader responsibilities created by the decree.

Key Points

• GMC announced royal approval on November 2, 2026, to transform its financial regulator into the autonomous Gelephu Central Bank.
• The bank may invest in cryptocurrencies alongside traditional reserves, with no mandatory Bitcoin purchase or fixed allocation.
• Its powers include monetary policy, financial supervision, reserve management, payments and liquidity support.
• Bhutan previously pledged up to 10,000 BTC to support GMC's development, linking the initiative to mining powered by hydropower.
• 3iQ manages a mandate backed by part of GMC's Bitcoin treasury and has committed to local training and investment expertise.
• More than 50 professionals are being recruited, while any future GMC currency would require the King's concurrence.