African crypto revolution continues as Ethiopia ranks among global BTC mining leaders

The year 2024 was a very important year for Ethiopia due to its access to cheap, reliable and renewable energy sources; because Ethiopia made a profit of approximately 1 billion dollars in mining.

Africa is a region producing fintech unicorns that provide payment solutions to the unbanked (and equally “smartphoneized”) population and merchants. Companies like TymeBank, Moniepoint and Opay have made hundreds of millions of dollars creating and maintaining mobile payment apps and location touchpoints. In the absence of banks (80% of Africans do not have a debit card), digital money solutions are filling the gap, and cryptocurrency is one of the factors shaping the continent’s current financial reality.

Ethiopia enters global BTC mining summit

According to Intellinews, in 2023, only 35% of Ethiopians had a bank account. However, this did not prevent the country from becoming one of the world leaders in Bitcoin mining. In 2024, Ethiopia became the first African country to have a high-scale state-backed crypto mining operation. Its revenue is expected to reach $5.4 billion in 2027.

The backbone of Ethiopia’s success in the sector is the Grand Ethiopian Renaissance Dam, a gravity dam on the Blue Nile River that will be built by 2024. GERD is one of the 20 largest hydroelectric power plants in the world and the largest in Africa. It provides electricity to the entire country and produces enough electricity for export to other countries.

Critics of Bitcoin have often highlighted the network’s excessive energy consumption, noting that many mining operations occur in countries with cheap electricity that rely on dirty fossil fuels. However, Ethiopia is mining bitcoin using cheap and clean energy from GERD. Interestingly, only half of Ethiopia’s population has access to electricity. This means that a significant part of the spare energy can be invested in mining.

In 2024, Ethiopia generated $1 billion in revenue through Bitcoin mining. Profits from mining help maintain GERD infrastructure. According to Happy Coin News, the mining operation accounted for 18% of the country’s annual national income.

Bitcoin mining provides 18% of Ethiopia’s revenue, thanks to the country’s use of its own GERD hydroelectric power plant to mine cryptocurrencies. Read more: https://t.co/qkqiQLwciO

— Happy Coin News ☣️ (@happycoinnews) December 28, 2024

In October, Luxor Mining COO Ethan Vera outlined the key components of Ethiopia’s success in the industry. These include cheap electricity and the use of mid-generation mining devices, which consume less power and cost less than new machines. According to Vera, the main models used in Ethiopia are Bitmain’s S19J Pro and Canaan’s A1346.

Ethiopia plan

In 2024, Ethiopia contributed 2.25% of global hashrate in Bitcoin mining. According to Luxor Mining, Ethiopia is the second largest contributor to hashrate after the United States, Hong Kong and Asia.

Ethiopia’s success shows that governments can use cryptocurrency to finance infrastructure development and support local economies. Ethiopia has emerged as a Bitcoin mining leader without compromising environmental sustainability. In particular, green mining requires easy access to clean energy, while profits are reinvested in the development of the dam, representing a win-win scenario.

Other countries also took this into consideration when Ethiopia built its mining power plant. The Democratic Republic of Congo, for example, is preparing to establish its own clean mining operation in Virunga National Park. Meanwhile, smaller players in other countries are developing local networks to support grassroots mining operations. Startups such as Gridless and Trojan Mining are also advancing environmentally friendly Bitcoin mining efforts in Africa.

Ethiopia is paving the way for other African countries to tap renewable energy sources to set up Bitcoin mining operations. Similar efforts across the continent could revitalize local economies, power the ongoing fintech revolution, and create new opportunities for African countries.