BIT Mining Expands into Ethiopia with $14 Million Deal
BIT Mining, a Chinese bitcoin mining company, has signed a $14 million deal to acquire facilities in Ethiopia, marking its expansion into the African nation. The company will acquire facilities worth 51 megawatts (MW) and nearly 18,000 bitcoin mining rigs in the country.
A Unique Opportunity for BIT Mining
According to Dr. Youwei Yang, chief economist at BIT Mining, Ethiopia’s ultra-low electricity costs provide a unique opportunity for the firm to extend the shelf life of its bitcoin mining rigs. The cost of electricity in Ethiopia is significantly lower than in Ohio, where BIT Mining currently operates, allowing the company to move older generation machines to the African nation.
A Positive Feedback Loop
By installing newer rigs in the US and sending aging ones to Ethiopia, BIT Mining creates a positive feedback loop. This allows investors to extract greater returns from their machines, attracting more capital to the company. Yang estimates that the company can get at least two extra years of use from its rigs by moving them to Ethiopia.
Why Ethiopia?
Ethiopia’s electric standard is similar to China’s, allowing BIT Mining to leverage its engineering team’s expertise and redeploy electric equipment previously used in China. The country also enjoys an abundance of hydroelectric power, thanks in part to Chinese investments. The Ethiopian government has been supportive of the mining industry, and the country is home to 1.5% of Bitcoin’s total hashrate.
Overcoming Challenges
Despite the country’s social unrest and shaky government control, BIT Mining has been studying and researching the situation, concluding that it is a stable place to operate. The company has decided to purchase a facility instead of building one from scratch to avoid unforeseen trouble. However, convincing employees to move to Ethiopia from the US or China has been a challenge.
Future Plans
BIT Mining is on the lookout for new investments in Ethiopia, including energy infrastructure projects, data centers for artificial intelligence (AI) purposes, and other bitcoin mining facilities. Yang believes that there are plenty of opportunities in the country, particularly in the AI sector, where the company has been studying the feasibility of a pilot experiment.
Conclusion
BIT Mining’s expansion into Ethiopia marks a significant milestone for the company, allowing it to take advantage of the country’s low electricity costs and extend the shelf life of its bitcoin mining rigs. Despite the challenges posed by the country’s social unrest, the company is optimistic about its future plans and the opportunities available in Ethiopia.
Source: Coindesk.com
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