Ethiopia's Bitcoin Boom: Chinese Miners Strike Gold in Africa's New Crypto Frontier
Feb 8, 2024
Chinese Bitcoin miners have found a new haven for their operations in Ethiopia, attracted by the country's low electricity costs and favorable government policies. Ethiopia, which began allowing Bitcoin mining in 2022 despite banning cryptocurrency trading, has strengthened ties with China, which played a significant role in building Africa's largest dam, the Grand Ethiopian Renaissance Dam. Chinese companies dominate the Bitcoin mining scene in Ethiopia, drawn by the promise of abundant, renewable energy and potential foreign exchange earnings. The Ethiopian government permits Bitcoin mining mainly due to the revenue generated in foreign currency, although officials are cautious about its impact on electricity access and consumption. Ethiopia's capacity for supplying electricity for Bitcoin mining may rival that of Texas, with plans to double generation capacity in the near future. Additionally, the climate in Ethiopia is conducive to mining operations, with temperatures within the ideal range recommended by rig manufacturers. Some Chinese mining firms have already begun operations in Ethiopia, leveraging geopolitical ties between China and Ethiopia, with the Chinese government being a major investor in Ethiopian infrastructure projects.