25 international cryptocurrency traders have recently established centers in Ethiopia, marking a significant stride in the country’s endeavor to attract global institutions.
This initiative, facilitated by the Ethiopian Investment Commission and other relevant bodies, underscores Ethiopia’s growing openness to international investment and technological advancement.
The Ethiopian Investment Commission has been instrumental in encouraging foreign participation in the country’s burgeoning cryptocurrency sector.
As part of this effort, 25 data mining companies have successfully registered with the commission and are currently finalizing power supply agreements with Ethiopian Electric Power, the national electricity provider.
The Department of Marketing and Business Development at Ethiopian Electric Power has confirmed that four out of the 25 registered companies have commenced operations.
Mr. Hiwot Eshetu, the department’s director, highlighted that while these data mining companies predominantly utilize local power sources, they have agreed to settle their utility bills in dollars, fostering a conducive business environment.
Of the 25 companies, four have obtained the requisite investment licenses and have begun harnessing power ranging from 10 to 100 megawatts.
Remarkably, the country has already received over $two million in foreign currency earnings from two operational data mining firms, marking a significant milestone in Ethiopia’s economic landscape.
While the remaining companies are poised to commence operations soon, two entities are scheduled to initiate utility bill payments next month, signifying a progressive trajectory in Ethiopia’s cryptocurrency infrastructure development.
Notably, five out of the eighteen organizations authorized for data mining activities have initiated construction, with an additional ten entities in the process of commencing construction activities.
These organizations, committed to facilitating cryptocurrency transactions or providing ancillary support services, are integral to Ethiopia’s emerging digital economy.
Ethiopia’s stance on cryptocurrency has evolved over the years. While the National Bank of Ethiopia prohibited cryptocurrency transactions two years ago, the country has demonstrated a willingness to engage in infrastructure development conducive to cryptocurrency operations.
Despite the ban on cryptocurrency trading, Ethiopia has actively pursued agreements for data mining center construction, showcasing a strategic pivot towards embracing digital innovations.
In a recent development, the Chinese company West Data Center inked a landmark $250 million agreement with Ethiopian Investment Holding in Addis Ababa.
This agreement not only signifies a substantial investment influx but also entails provisions for training on Bitcoin trading and artificial intelligence, underscoring Ethiopia’s commitment to technological capacity building.
The global cryptocurrency landscape, predominantly concentrated in regions like Texas, USA, underscores the substantial energy demands associated with cryptocurrency operations.
With an average daily energy consumption of 2,300 megawatts, these institutions are increasingly seeking alternative locations to mitigate energy consumption concerns, providing opportunities for emerging markets like Ethiopia to attract such ventures.
Ethiopia’s strategic initiatives to foster a conducive environment for cryptocurrency ventures underscore its evolving role in the global digital economy.
By embracing technological advancements and fostering international partnerships, Ethiopia is poised to capitalize on the transformative potential of cryptocurrencies while positioning itself as a hub for innovation and investment in Africa.
