How Ethiopia Could Monetize Bitcoin & Escape the Industrial Phase

Plan A: Mining

If the Grand Ethiopian Renaissance Dam (GERD) is successful and put into use as planned, the average Ethiopian’s life would improve - not just because they would have access to electric power 24/7, but also because their country would have more foreign currency reserves that it can use to improve the lives of its citizens. The dam is a great accomplishment and it has a very strong case for internal use. The export part of the dam is also important, and while many may not realize it, it is linked to what Ethiopians celebrate when they praise the power of the dam.

Ethiopia plans to increase its power exports to neighbouring nations by 900m$+ USD. Ethiopia’s current exports according to the US Department of Commerce are around 3bn$ USD. So the dam can have big implications for the economy. However, as good as the export plan sounds, exporting power can be difficult. Exporting power for Ethiopia isn’t necessarily going to be very straightforward. There are many political issues involving multiple countries; they argue that using a certain percentage of the dam is a threat to their sovereignty. There is also a question from some government bodies about spending a significant amount of our foreign reserves to build infrastructure for potential, not guaranteed, customers.

Hypothetically, if part of GERD is repurposed to mine Bitcoin, it could potentially produce billions of dollars a year.

If, Ethiopia instead used the GERD dam to mine Bitcoin using common Bitcoin mining hardware:

Mining Type - ASIC based

Mining Equipment - Antminer S19

If we say we are running the above miner with 115TH/s, using 3350w at 3.25kwh per machine GERD's ~80% power can generate and provide a total of 212307595 TH/s to the Bitcoin network.

10,000 S19 machines will cost about 105m$ to acquire and set up (<10% of what Ethiopia would need to invest for building infrastructure to export power for GERD - estimated to cost more than 1.7bn$).

Running 10,000 S19 ASIC machines with the current difficulty adjustment of the network, and up until the next halving (4 years), will yield 175 BTC monthly, or 2100 BTC per year. These machines will not require too much power to run and are perfectly scalable to grow in numbers.

Basically less than 5% of the dam can be used to power these machines, providing Ethiopia with alternate ways of turning power into revenue.

This is only at a minimal capacity of GERD. The dam at full capacity can power over ~200,000 similar machines, which would yield more than 81,900 BTC (~2bn$ yearly at current price).

The mining equipment can be bought or it can be shared profit partnered with other miners and mining companies who are thinking of transitioning from other non-environmentally friendly mining methods such as coal & oil. Since Ethiopia has access to very cheap, almost zero cost, renewable electricity, for this purpose the mining capacity can slowly grow relative to the profits. These are very very high and promising numbers of hope. Considering our current exports, a sudden multiplier to the exports with a very minimal financial & time investment but guaranteed outcome seems very attractive.

2-4 Billion USD a year!

So what does 2-4 Billion USD mean for the Ethiopian government?
  • >  It means it will help close the trade deficit and remove capital controls, effectively improving productivity and life quality of its citizens.
  • >  It will grow the country’s GDP and GDP per capita.
  • >  It will help counter black market exchange rates short term
  • >  It means the government can let anyone, and itself, import most things it wants more comfortably, at least for the short term.
  • >  It will attract new businesses and tourism from all around the world, there is a worldwide community of Bitcoiners and Bitcoin-centric businesses who seek to reside within a Bitcoin friendly nation. This can be seen with what Bitcoin adoption will do for El Salvador’s economy & prestige.

Generating FX Liquidity

If we as a country successfully mine Bitcoin, we wouldn’t need to sell them every time we mine them to find foreign currency liquidity. We could still use and own the bitcoins we have, lend them to liquidity providers, and borrow against them - this would be an automatic and instant process that can happen in traditional DeFi (Decentralized Finance).

A better way of saying that maybe: we could have the bitcoins, use them as collateral to get foreign currency of their worth, and then use this foreign currency to do whatever we want while we hold onto our Bitcoins.

  • - If we don’t pay back our debt to the liquidity provider, they will keep our Bitcoins.
  • - If we return the stablecoin FX liquidity to the lender, we get our Bitcoins back.

So in the worst cases, defaulting on a debt wouldn't be much of an issue for the country because we would lose only our bitcoin collateral. But in the cases where we use our newly minted FX stablecoins to move our economy forward, when we pay back our debt, we get our bitcoins back and they presumably will only increase in value. So it's a win-win contract, especially for a country like Ethiopia.

We don’t have to hold every single mined Bitcoin. We understand Ethiopia needs to see the fruits of its mining asap.


According to a statement published by the Ethiopian government in 2018 & 2019, Ethiopia exports power to Djibouti and Sudan (up to 100 MW/each) with a combined annual revenue of less than 90m$ USD.

When comparing the revenue gained by exporting electricity to the revenue earned by bitcoin mining in Iran, Ethiopia might have produced four to six times the money (4-6x) by bitcoin mining instead of exporting electricity to neighboring nations, without even having to build complex and expensive infrastructure.

Selling power to neighboring countries is not necessarily scalable, as the countries are limited in how much they can spend on buying power. Djibouti for instance wants to buy a maximum of 400MW, and they don’t buy every hour of every day. Ethiopia doesn’t have to waste a single MW if it mined Bitcoin with it. Mining is perfectly scalable, each minute the energy is not being used for other purposes, it can be directed at more mining machines.

Plan B: Hodling

This section is not a new idea. It has been suggested various times, holding some BTC in a reserve is likely going to guard the ETB from slumping, more effectively than the plans the National Bank has been implementing and considering to our knowledge. The first mainstream suggestion about this that we know of came from an Open Letter to PM Abiy Ahmed, where we tried to make the case for holding bitcoin when the price was nearing ~16,000$.

You may have read their article aimed at Abiy Ahmed, where they mention "To maintain our buying power and import as much stuff as we did last year, our GDP growth rate needs to be much more than the inflation rate of the US Dollar."

Given Ethiopia's economy is not growing remotely near 25% year after year, our buying power is naturally depleting quickly against scarce assets. If the Ethiopian economy is only growing 7% a year, we are not catching up to the rate we need to break even.

Right now, the public inflation rate of ETB is nearing 35%, and the apparent capital controls are only getting tighter. The National Bank is also seen trying to minimize the velocity of money by insisting and limiting people to make only a number of transactions per week. However, we at Project Mano believe this strategy is a double edged sword that will create more trouble for the banks, as people lose trust in the banks and take their money out. Simultaneously, since less money is stored and monitored by the National Bank, their ability to control and predict the economy only loosens. Bitcoin fixes this exact problem.

If Ethiopia buys and stores 1m USD worth of bitcoin today and bitcoin keeps performing according to its history, in 100 Years, it won’t lose 95% of its value like it does with USD, or like we would with any other cryptocurrency.

As a non-fiat, scarce, currency, Bitcoin provides a reliability that is unbeatable by fiat currencies and most other cryptocurrencies (including Ethereum - which is inflationary similar to fiat, unlike Bitcoin). Its cryptographically secure hashing algorithm provides an absolute limit to how many coins can exist, so it will not lose value through supply inflation (the coin supply will never grow unlike Dogecoin, Ethereum, Fiat). As the monetary value of fiat currencies around the world shrink due to their arbitrarily ever-increasing monetary supply that is uncorrelated with the supply of resources, Bitcoin does the opposite; maintaining its value and growing in worth when compared to its fiat counterparts, which will grow in supply. It is protected by a truly decentralized network that uses solid mathematical hashing to ensure the limit is absolute and can’t grow above 21 million coins.

Only way we can see actual appreciation in our ever-increasing GDP’s buying power is if our growth rate is significantly higher than the USD inflation rate or if we experience huge ETB deflation. And that is just a big ask. expecting our GDP to increase another 4%+ in the short term so we break even with our buying power is just a preposterous and unrealistic expectation.

Traditional investment methods into the public and trade aren’t gonna cut it. It will not give us anywhere near the growth rate we need. We need another plan. We need a plan ฿.

Whether or not pursuing the plan of mining, we sincerely ask the Ethiopian government to put at least 1,000,000 USD or more into this digital asset and invest in its future generation and hold it for 50-100 years the same way National Bank holds Gold. We are asking NBE to consider holding very little Bitcoin the same way it does hold Gold. While USD is just paper and more can always be printed, that’s not true with Bitcoin. One is very clearly more valuable. We don’t have to do much - putting little of the USD could mean miraculous returns in a few decades.


The National Bank of Ethiopia holds multiple countries’ currencies, treasuries, and bonds as a reserve. Most of the holdings are USD, which makes sense since 80%+ world trade is in USD. However, the monetary supply in the US has been increasing by at-least 10% every year over the last decade. Unlike the government’s inflation estimate of 2%, the actual inflation rate, according to the increasing monetary supply, should be between 7–10%, every year. The inflation rate on long bonds should be way over the top, at a whopping 22%. This subsequently will result in Real Yield (RY) turning up at -10% for at least the next three years.

Bitcoin has gone up on average +100% every single year. EVERY SINGLE YEAR! The USD goes down in value every year! We are getting poorer and poorer with one. We can recover multiple years of USD value loss, just by storing bitcoin for a handful of years.

Plan C: Linking it to ETB or Other Legal Tenders

El Salvador became the first country to start treating Bitcoin as legal tender. It means that within the country people can use it to buy and sell things legally, including but not limited to paying taxes and employees with it. This is a huge move as it helps Bitcoin get recognized as money under US and international Commercial Law where Cornel states "Money means any medium of exchange currently authorized or adopted as legal tender by a domestic or foreign government".

So a tender that is recognized in a forigen country as legal currency can be seen as foreign currency, which Central Banks (and commercial banks) can hold easily, as they can with any other foreign currency.

This is the third and last resort we suggest for the National Bank before the Birr, and people’s valuable earnings fall in value because of monetary policies of another nation. Before recognizing Bitcoin as legal tender, we believe the government should attempt to back part of the currency with Bitcoin reserves. It doesn’t mean every single bank note has to be backed by a Bitcoin reserve, but overall, that the whole thing being somewhat backed by something verifiable on-chain, with cryptography. We believe this would increase the public’s trust in the currency, while minimizing a scarce mentality - and backing part of the currency with Bitcoin, still doesn’t prevent the government from printing more ETB. Which we believe is a win-win for the government and the public!

It is, of course, plausible to imagine a future where all the above 3 suggestions are part of the economy - where Government mines Bitcoins (Part A), Holds them in a wallet to hedge FX inflation (Part B), borrow against the mined BTC to have easily accessible & sovereign FX reserve while holding the BTC, and allowing it as tender or backing part of the reserves with it (Part C).

An example portfolio can look like: 10% of mined coins can be sold once a month for FX Dollars, 10% can be put in DEFI for yield farming, and 40% can be used as collateral to borrow USD against, while another 40% held as BTC reserve.

Project Mano is just getting started! We will not stop! We are unstoppable! We are a crowd! Just like Bitcoin, Mano is an idea - we believe once it's out there, it's impossible to kill and will eventually be implemented. Please do your part and share and/or contribute to this project that's dear to our hearts!