Ethiopia Boosts Bitcoin Mining with 600MW Power Capacity

Ethiopia is rapidly establishing itself as a burgeoning hub for Bitcoin mining, currently consuming 600MW of power, with plans to increase capacity significantly in the near future. Ethan Vera, co-founder and COO of Luxor Mining, shared insights on the country's mining landscape in a recent thread on X, citing data from Ethiopian Electric Power.

With an installed generation capacity of approximately 5,200 MW—predominantly sourced from hydropower, along with wind and thermal energy—Ethiopia is set to add several hundred more megawatts by the end of this year, further solidifying its position in the global mining market.

Efficient Mining Operations

Vera noted that most local mining operations utilize mid-generation machines, such as Bitmain's S19J Pro and Canaan's A1346 models. These machines are not only cost-effective but also consume less power, making Ethiopia an attractive location for their use due to the country's low electricity rates. He mentioned that many mining farms are equipped with evaporative cooling systems, although these are often unnecessary for most of the year due to the cooler climate.

Strategic Growth Initiatives

Ethiopia's foray into Bitcoin mining is part of a broader strategy to enhance its digital infrastructure, including data mining and artificial intelligence training. In February, Ethiopian Investment Holdings announced a preliminary agreement to collaborate with Hong Kong-based West Data Group on a $250 million project aimed at improving the country’s digital infrastructure. While specific details of the deal remain sparse, it aligns with the government’s vision for high-performance computing, which encompasses Bitcoin mining.

The momentum behind Ethiopia’s mining sector has been fueled in part by China's 2021 ban on crypto mining. This has led many miners to seek new opportunities in regions with lower electricity costs. However, despite the advances in expanding its electricity supply, around half of Ethiopia’s 120 million citizens still lack access to reliable electricity.

Conclusion

Ethiopia’s strategic support for Bitcoin mining, coupled with its abundant hydropower resources and low electricity costs, positions the country as a significant player in the global cryptocurrency mining landscape. As the sector continues to grow, the government's initiatives to improve digital infrastructure may further enhance Ethiopia’s attractiveness to miners and investors alike.