Chinese mining companies are expanding their business in Ethiopia

Chinese companies have identified Ethiopia as a strategic destination for investment and the establishment of large-scale bitcoin mining operations, according to sources from Bloomberg. The legalization of bitcoin mining in Ethiopia in 2022 has opened up new opportunities for foreign companies, with the government offering excess energy capacity to attract investments in the nation’s economy.

Chinese firms have already made significant investments in the construction of a $4.8 billion dam, which will provide the necessary electricity for mining activities. Out of the 21 companies that have agreements with Ethiopian utilities, 19 are Chinese. Factors such as a favorable geographical climate, low-cost electricity (92% of which is generated by hydroelectric power), and supportive government policies make Ethiopia an attractive destination for Chinese miners.

In addition to Chinese companies, Russian firm BitCluster has announced plans to launch a data center in Ethiopia’s capital, Addis Ababa. The data center, with a capacity of 120 MW, will primarily focus on the production of military-technical equipment. It is expected to be fully operational by the first quarter of 2024, housing 34,000 Antminer S21 miners with a total hashrate of 6.8 EH/s.