Ethiopia, A New Heaven For Bitcoin Miners From China!

Ethiopia attracts the attention of bitcoin miners. (Photo; Doc. Blockbuilding)

JAKARTA - Ethiopia is increasingly attracting the attention of Bitcoin miners from China by offering its cheap electricity and ideal climate costs. The East African country is one of the largest Bitcoin mining centers in the world, thanks to its abundant hydroenergy resources.

After being banned by the Chinese government for environmental reasons, Chinese Bitcoin miners are looking for a new place that offers affordable electricity and friendly regulations. Ethiopia is their top choice, as it has some of the lowest electricity costs in the world and governments supporting the crypto industry.

Since spring last year, Chinese Bitcoin miners have started entering Ethiopia with cargo containers containing mining equipment. They place their equipment near an electric substation connected to Africa's largest hydropower project, the Ethiopian Renaissance Dam (GERD).

According to Luxor Technology, a company providing Bitcoin mining solutions, Ethiopia has become one of the main destinations for the delivery of Bitcoin mining equipment, with Chinese miners accounting for significant parts. These miners benefit from Ethiopia's 5,3 gigawatt installed generating capacity, mainly from renewable hydro energy.

With a fixed electricity rate of 3.14 US cents (IDR 23.7) per kilowatt-hour, Ethiopia offers miners competitive operating costs. In addition, Ethiopia's friendly climate fits the optimal operating conditions for mining equipment.

Although Ethiopia still bans crypto trading, by 2022 the country will allow Bitcoin mining. The decision was strengthened by increasingly close ties with China, with several Chinese companies contributing to the construction of a $4.8 billion GERD (IDR 36.2 trillion), from which miners intend to get their electricity.

As Chinese Bitcoin miners flock to Ethiopia in line with China's investment in the country, it actually strengthens bilateral relations between the two sides. Ethiopia's desire to attract foreign investment is in line with China's broader strategy in Africa, strengthening mutually beneficial relations between the two countries.

Even so, Ethiopian officials responded cautiously to this due to the controversy surrounding Bitcoin mining, paying attention to the balance between economic gains and the social impacts caused by BTC miners.