Chinese Bitcoin Miners Turn to Ethiopia After Beijing Ban

Following Beijing’s crackdown two years ago, Chinese Bitcoin miners have sought new grounds with affordable energy and favorable regulations.

Ethiopia now serves as their chosen spot, Bloomberg reports.

Ethiopia welcomed Bitcoin mining in 2022, offering some of the world’s lowest electricity costs. Yet, it bans cryptocurrency trading and has faced recent political instability.

The bond between China and Ethiopia has grown stronger over the last decade.

Chinese firms built a $4.8 billion dam crucial for miners seeking sustainable energy, despite Ethiopia’s widespread electricity shortagesy.

According to Luxor Technology, Ethiopia is now a key importer of Bitcoin mining machinery.

The nation’s energy monopoly has struck deals with 21 Bitcoin miners, with most being Chinese.

Globally, Bitcoin mining is under scrutiny due to climate change and energy shortages, pushing a $16 billion market into disfavor.

Countries like Kazakhstan and Iran initially embraced mining but have since backed away amid internal dissatisfaction.

The end of China’s reign in bitcoin mining in 2021 forced many companies to find new locations.

Mining is essential for Bitcoin’s network, as it involves using powerful computers to secure and process transactions on the blockchain, rewarding miners with Bitcoin.

This activity consumes a lot of energy, necessitating cheap electricity.

In 2023, Bitcoin mining’s energy use was estimated at 121 terawatt-hours, similar to Argentina’s, sparking debate over its environmental toll and questioning its overall benefit.