Ethiopia Targets Billions With State-Backed Bitcoin Mining

Key Takeaways:

• Ethiopia has a state-funded project on Bitcoin mining and is currently in search of international alliances in terms of capital and mining skills.
• There are already 25 licensed miners in the country that govern approximately 2.5% of the world hash rate of Bitcoin.
• The Grand Ethiopian Renaissance Dam is providing cheap hydropower that is transforming Ethiopia into the most strategic Bitcoin mining location across Africa.

Ethiopia is shifting to obtain the silent participation of private Bitcoin miners to the state-directed mining of Bitcoin. The move portends a more serious interest in crypto as a source of national income and not an ancillary activity that is fuelled by foreign investors.

Ethiopia is Headed to State Controlled Bitcoin Mining

During the Finance Forward Ethiopia 2026 event, Prime Minister Abiy Ahmed affirmed that the government is about to roll out a state-backed Bitcoin mining venture. Ethiopian Investment Holdings, the state owned investment company in the country, will head the project and is currently seeking foreign partners.

The government seeks partners that have experience of mining in large scale of Bitcoin. The government is seeking investors who can introduce capital, high-tech mining equipment as well as operational expertise, but retain the mining infrastructure and economic advantage within Ethiopia.

This strategy signals a distinct change. So far Ethiopia has worked on the aspect of licensing of miners who are privately owned and selling them electricity. The government under the new plan aspires to directly mine Bitcoin and take a bigger piece of value generated by its energy resources.

Does Ethiopia Matter in Global Bitcoin Mining?

The involvement of Ethiopia in the mining that is supported by the state is not beginning in nothingness. The nation has been working the past few years to establish a formidable footprint in the global Bitcoin mining scene, much to the outside world.

The Major Benefit of Cheap Hydropower

Energy is the foundation of the mining attraction in Ethiopia. Grand Ethiopian Renaissance Dam has offered a lot of cheap hydropower in high quantities with this source providing a certain price stability that most miners would not find elsewhere.

One of the largest variants in Bitcoin mining profitability is electricity costs. The fact that Ethiopia can provide dependable and renewable power has seen the country become the haven of miners who wish to hedge margins as the world encounters more challenges in mining.

2.5% of Global Hashrate Is Already in Ethiopia

There are 25 registered Bitcoin mining firms in Ethiopia. Collectively, these companies own approximately 2.5% of the Bitcoin hash power in the world. This is a huge portion in the case of one African country and Ethiopia in the world is one of the more pertinent mining jurisdictions in the world.

It is even said that these private operators have already made more than $200 million of revenue, which proves that Bitcoin mining already provides real economic value. The state-supported project is not based on the skyrocketing but rather on this foundation.

Read More: Strategy Drops $1.25B on 13,627 Bitcoin, Total Holdings Surge to 687,410 BTC

Bitcoin Mining Fits Ethiopia’s Digital Ethiopia 2030 Strategy

The mining project is part of the larger Digital Ethiopia 2030 strategy in which Ethiopia aims to leverage technology to aid economic development and modernization.

Bitcoin mining contributes to the following functions in this system:

• Commercializing surplus electricity which could be used for nothing.
• Favoring the enhancement of the data infrastructure.
• Invention of technical employment related to hardware, cooling and data functions.

Bitcoin mining can be both capital intensive and skills transfer opportunities can be gained. The mining farms are large and demand knowledge of electrical engineering, network security, data center management and hardware maintenance.

Through a joint venture with other world renowned companies, Ethiopia is planning to localize the aspects of this knowledge rather than outsourcing all the technical operations.

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