Ethiopia attracts bitcoin miners from China. All because of cheap electricity and regulations friendly to cryptocurrency miners of digital assets. Interestingly, Ethiopia has officially banned the use of cryptocurrencies, but allows their mining. Miners from China have spotted an opportunity and are flocking to Ethiopia and other African countries. Will Ethiopia or Congo soon become a hub for bitcoin miners?
Ethiopia tempts bitcoin miners – the reason is cheap and ecological electricity
Chinese BTC mining companies are increasingly willing to look towards Africa. Ethiopia has recently been attracting particular interest, as revealed by one of the latest Bloomberg reports. It is worth adding that Ethiopia (like China) has officially banned the use of cryptocurrencies, but the country legalized Bitcoin mining in 2022.
Since 2021, Chinese miners have been looking for a safe haven where bitcoin mining will be not only legal, but above all, maximally profitable. Ethiopia seems to be a real Promised Land for Chinese BTC mining companies. This is all due to not only the legality of bitcoin mining, but also low electricity prices. Ethiopia is a country where as much as 92% of electricity is obtained from hydroelectric power plants. An abstract summary is the fact that despite such low energy prices, nearly half of Ethiopia's inhabitants live without access to electricity.
Africa as a hub for bitcoin miners?
According to a Bloomberg report, as many as 19 out of 21 companies expressing interest in BTC mining operations in Ethiopia are Chinese companies. In addition to cheap electricity, Ethiopia's climate is a definite advantage for BTC mining companies. Contrary to appearances, Ethiopia has a much more moderate climate than, for example, Texas, which is considered an American hub for BTC miners. High temperatures in Texas mean that cooling BTC miners increases the overall cost of mining.
Another interesting conclusion from the report is the fact that some of the reported Chinese companies present themselves as factories or agricultural projects. The purpose of such actions is to obtain approval for the use of electricity faster, without official permission to mine BTC. Similar situations have already occurred in countries such as Iran or Kazakhstan. However, when governments realized that a given institution was actually a cryptocurrency mine, they not only closed the company, but also confiscated valuable equipment. So this is a game not worth the candle.
