Ethiopia Becomes a Major Player in Bitcoin Mining Industry

Ethiopia Emerges as a Growing Bitcoin Mining Hub

Ethiopia is rapidly emerging as a significant player in the Bitcoin mining industry, with local miners currently consuming 600MW of power. This capacity is expected to increase further this year.

Ethiopia’s Expanding Bitcoin Mining Industry

The country’s Bitcoin mining sector is gaining momentum, leveraging its substantial installed generation capacity. Ethiopia has around 5,200 MW of installed power, primarily from hydropower, with wind and thermal sources contributing to the remainder. This capacity is anticipated to grow by several hundred megawatts by the year’s end, according to Ethan Vera, co-founder and COO of Luxor Mining.

Utilization of Mid-Generation Mining Machines

Most mining operations in Ethiopia are utilizing mid-generation machines such as Bitmain’s S19J Pro and Canaan’s A1346 models. These machines are typically more affordable and energy-efficient, benefiting from Ethiopia’s low electricity costs. Vera notes that Ethiopia is a “great place to use this class of machine.”

“Most mining farms had evaporative cooling (water walls) set up, although it’s not needed for the majority of the year given the cold climate.”

Strategic Developments in Digital Infrastructure

Ethiopia’s strategic move into Bitcoin mining aligns with its broader push to develop infrastructure for data mining and artificial intelligence training. In February, Ethiopian Investment Holdings announced a preliminary agreement to support a $250 million project with Hong Kong-based West Data Group to enhance the country’s digital infrastructure. While specific details of the deal remain unclear, the government has consistently referred to such initiatives as part of its high-performance computing strategy, which includes Bitcoin mining.

Impact of Global Crypto Mining Trends

China’s 2021 ban on crypto mining and Ethiopia’s government-authorized push into the sector in 2022 have led to increasing interest from miners seeking new opportunities in regions with lower electricity costs. Despite progress in expanding its electricity supply, around half of Ethiopia’s 120 million people still lack access to electricity.

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