BIT Mining has expanded operations to Ethiopia, capitalizing on low electricity costs to extend the lifespan of mining rigs. The company acquired significant facilities and aims to leverage Ethiopia’s hydroelectric power. Despite the challenges posed by civil unrest, BIT Mining sees potential for growth and investment in the country, with plans to employ local workers in the industry.
BIT Mining has successfully expanded its operations from Akron, Ohio, to Ethiopia, leveraging the country’s exceptionally low energy costs. The company acquired 51 megawatts and 18,000 bitcoin mining rigs earlier this December, enabling it to extend the lifespan of older mining equipment that would typically become obsolete within two years in the U.S. The economic feasibility of operating in Ethiopia is supported by hydroelectric power, which is particularly abundant due to investments from China, such as the Grand Ethiopian Renaissance Dam.
Ethiopia currently contributes about 1.5% of Bitcoin’s total hashrate, making it a notable player in the bitcoin mining industry. Despite ongoing civil unrest and the effects of a civil war, the Ethiopian government has shown support for the mining sector, which has attracted BIT Mining’s interest. The strategic relocation of older mining rigs to Ethiopia allows the company to generate better returns for investors, establishing a beneficial production cycle.
Dr. Youwei Yang, chief economist at BIT Mining, noted the stark difference in electricity costs, emphasizing that while energy can be nearly double the price in Ohio, it is significantly lower in Ethiopia, thereby facilitating the repurposing of older machines. This operational strategy is critical, particularly given the high cost of new rigs and the caution investors exhibit regarding expenditures in politically unstable areas.
The Ethiopian electric infrastructure mirrors China’s, assisting BIT Mining in efficiently operating its mining facilities. Moreover, the firm plans to transition to employing a predominantly local workforce to foster community integration, as it continues to explore further investments in Ethiopia’s energy and technology sectors, such as artificial intelligence data centers. Lastly, there exists notable optimism surrounding the economic potential within Ethiopia, despite the challenges present due to the nation’s turbulent history.
In December 2022, BIT Mining, a Chinese bitcoin mining company, made significant strides by acquiring substantial mining operations in Ethiopia. The company aims to take advantage of Ethiopia’s remarkably low electricity costs, which allows for the viability of older mining technologies that typically fall out of use in more competitive markets like the United States. Ethiopia’s growing role in the bitcoin mining sector is tied to its substantial hydroelectric capacity and supportive governmental stance towards the industry, despite existing sociopolitical challenges.
BIT Mining’s expansion into Ethiopia highlights the strategic advantages of low operational costs in regions with abundant renewable energy resources. By reallocating older bitcoin mining rigs to Ethiopia, the company capitalizes on both economic efficiencies and market potential. While there remain concerns regarding the stability of the Ethiopian government and regional safety, the firm is optimistic about forging a successful path in this emerging market. Through thoughtful investment and community engagement, BIT Mining seeks to make a significant impact in Ethiopia’s technological landscape.
Original Source: www.coindesk.com
