You can check the website statistics yourself or request them from us at [email protected]
On this platform, only organic high-quality traffic
Bitcoin
$ 30,725

Ethiopia Emerges As New Bitcoin Mining Hotspot – Will it Last?

Ethiopia has emerged as a burgeoning hub for Bitcoin mining, particularly after China’s expulsion of the industry in 2021.

In the wake of the ban, major players from China began seeking new havens for their energy-intensive operations worldwide.

This quest brought them to Africa, with many arriving in Ethiopia last spring. Cargo containers housing potent mining rigs began cropping up near electricity substations linked to the Grand Ethiopian Renaissance Dam.

Ethiopia Embraces Bitcoin Mining

Although Ethiopia has prohibited the trading of cryptocurrencies, it began allowing Bitcoin mining operations as of 2022.

In the realm of cryptocurrency, “mining” refers to the process by which new units of Bitcoin are introduced into circulation and the underlying blockchain is secured.

Given that miners require substantial amounts of electricity to compete for new BTC, electricity constitutes a fundamental cost of their operations. Ethiopia stands out for its remarkably low electricity expenses globally.

Furthermore, it’s a particularly enticing destination for Chinese enterprises. Over the past decade, Ethiopia has strengthened its ties with China, with numerous Chinese companies contributing to the construction of the $4.8 billion dam that will provide power to the miners.

When compared to other energy-intensive industries, mining stands out for its indifference to demand and location. This unique characteristic allows miners to prioritize inexpensive power sources above all, regardless of geographical constraints or supply reliability.

In 2021, Norway exemplified this trend by powering nearly 1% of the world’s Bitcoin miners, predominantly utilizing hydropower.

Nuo Xu, the founder of the China Digital Mining Association, remarked to Bloomberg, “Ethiopia will become one of the most sought-after destinations for Chinese miners.”

Following a similar trajectory, Russia has also embraced Bitcoin mining while concurrently prohibiting the use of cryptocurrency for transactions, such as payments.

Risks Of Bitcoin Mining

The calculus for regulators in weighing the pros and cons of hosting miners within their jurisdiction is complex. While mining can offer significant economic benefits, it also poses challenges such as straining electricity grids during periods of high demand.

Kazakhstan and Iran serve as prime examples; both were once prominent players in Bitcoin mining but eventually shifted their stance due to concerns over energy consumption.

Jaran Mellerud, CEO of Hashlabs Mining, highlighted two key risks: “Firstly, countries may exhaust their available electricity capacity, limiting the potential for miners to expand. Secondly, miners could face sudden government crackdowns and be compelled to cease operations and relocate.”

Related Posts

Leave a Reply

Confirm now and stay with our news

What we write about

I want to save money. Will cryptocurrency work?

Cryptocurrency is essentially virtual money that operates in a decentralized manner, not through a bank but directly on multiple independent computers.

Every cryptocurrency has two main components: the units of digital exchange called “coins” and the network within which the exchange takes place. These units can be transferred between wallets and exchanged on exchanges. The networks in which these coins exist are called blockchains, which translates to “chains of blocks.”

Latest Articles

Coinbase Unveils Two New Wallet Solutions Aimed at Easing Crypto Onboarding
01.03.2024By
Worldcoin Developer Acquires Solana-Based Digital Wallet Ottr
01.03.2024By
Web3 Lost Over $200 Million to Hackers in Two Months of 2024, More to Come – Immunefi
01.03.2024By

Latest news

Coinbase Unveils Two New Wallet Solutions Aimed at Easing Crypto Onboarding
01.03.2024
Worldcoin Developer Acquires Solana-Based Digital Wallet Ottr
01.03.2024
Web3 Lost Over $200 Million to Hackers in Two Months of 2024, More to Come – Immunefi
01.03.2024
Musée d’Orsay Breaks New Ground with On-Chain Exhibition and NFT Auction
01.03.2024
Crypto Lender Ledn Now Offers ETH-Backed Loans to Meet Growing Demand
01.03.2024
BlackRock to Launch Brazil’s First Bitcoin ETF on March 1
01.03.2024
Traditional Banking Titans Bank of America and Wells Fargo Look to Offer Bitcoin ETF Access
01.03.2024
Telegram to Launch Advertising Platform Using TON Blockchain
29.02.2024
3 Crypto Experts Predict This New Coin Might 50x In March
29.02.2024
Expert Take: Rising DeFi TVL is Silencing the Doubters
29.02.2024