Ethiopia inks $250M deal with Hong Kong firm for BTC mining: report

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Ethiopia’s march toward being Africa’s block reward mining hub has been significantly boosted, with the country’s government signing a deal with a Hong Kong firm to inject $250 million into BTC mining.

The Ethiopian Investment Holdings (EIH), the strategic investment arm of the Ethiopian government, announced the deal on Thursday. Initially, its social media post confirmed that it had signed the agreement with Data Center Service PLC, a subsidiary of West Data Group.

Launched initially as a digital asset trading and blockchain financial services firm, the Hong Kong-based West Data Group ventured into BTC mining in 2021. It has focused its efforts on Africa, with subsidiaries in Kenya and Angola.

EIH has since removed any reference to West Data Group or the size of the deal from its posts and has declined to offer any clarity to media outlets.

It's official!🥂

The Ethiopian Government will be mining bitcoin through it's partnership with an undisclosed international company with experiences in bitcoin and data mining🫱🏽‍🫲🏿

The partnership will be for the purposes of a multi-million dollar project in Ethiopia 🇪🇹 pic.twitter.com/mX3I5KAjT3

— Kal Kassa (@KalKassa) February 16, 2024

The news comes days after a report unearthed the aggressive investment in BTC mining by Chinese companies in Ethiopia. Bloomberg revealed that Ethiopia’s grid operator has signed deals with 19 Chinese miners to establish operations in the East African country.

Ethiopia has invested heavily in electricity production and offers some of the lowest rates globally, drawing block reward miners. The country is edging closer to completing the Grand Ethiopia Renaissance Dam (GERD), Africa’s largest, which will double its power generation. BTC miners have reportedly already signed deals with the Ethiopia Electric Utility (EEU) to be among the first to tap into the electricity generated by the new dam.

Controversially, about 40% of Ethiopians—over 48 million people—don’t have access to electricity even as the government signs multi-million dollar deals to strain the grid further.

Currently, the block reward miners are happy to find a home after unsuccessful stints in Kazakhstan, Russia, Iran, and a few other European countries. Media outlets report that some are so eager to start mining that they are posing as factories and farms to get connected to the grid.

Watch: Think of Bitcoin mining as financial self-discipline