Nasdaq-listed Bitcoin mining operator BitFuFu Inc. is reassessing its planned acquisition of an 80-megawatt (MW) mining facility in Ethiopia. The deal has stalled following a financial and operational dispute between the local target company and its regional electric power supplier.
According to a regulatory statement sent to Capital, the acquisition—originally announced in October 2024 through BitFuFu’s wholly owned subsidiary, Finfront Holding Company—remains unconsummated due to unmet conditions precedent. The transaction was structured to secure a majority stake in the Ethiopian entity owning the 80MW site, marking a pivotal step in BitFuFu’s strategy to transition from third-party hosting dependencies toward owning and operating dedicated infrastructure.
BitFuFu has disbursed $4.1 million in total cash payments to the sellers and deployed approximately 13,700 Bitmain Antminer S19-series machines to the facility. The deployed hardware generates a combined hashrate of roughly 1.57 EH/s, carrying a total net book value of $1.74 million as of late September 2026.
However, the acquisition faces severe headwinds. BitFuFu revealed that the local target company is involved in a contractual payment dispute with its Ethiopian power provider. On September 28, 2026, the supplier issued a formal ten-day notice demanding settlement of outstanding balances. The utility warned it would exercise security rights and seize collateralized assets upon expiration. BitFuFu noted that the disputed amounts remained unpaid at the time of its disclosure.
While BitFuFu is not a direct party to the underlying power agreement, management emphasized that the conflict poses a material risk to closing the transaction under its original terms. Key unmet conditions precedent include mandatory regulatory filings in Ethiopia, asset consolidation, and the absence of undisclosed liabilities.
In response, BitFuFu is actively evaluating legal remedies under the acquisition agreement. Potential actions include terminating the contract, initiating arbitration proceedings against the sellers, pursuing full recovery of the $4.1 million cash consideration, and demanding the immediate return of its deployed hardware.
CEO Leo Lu sought to reassure investors, noting that power curtailments had already been factored into previous operational guidance and that the dispute will have a minimal incremental impact on total production. BitFuFu maintains sufficient resources to reallocate hardware if local operations require adjustment. Nevertheless, the situation leaves one of Ethiopia’s prominent industrial-scale crypto-mining ventures in jeopardy.
The BitFuFu impasse unfolds against a volatile chapter in Ethiopia’s engagement with Bitcoin mining. In 2022, the government legalized industrial crypto-mining while maintaining a strict prohibition on local cryptocurrency trading. The strategy sought to monetize surplus hydroelectric capacity—particularly from the Grand Ethiopian Renaissance Dam—by selling electricity to foreign miners in hard currency.
By 2025, state utility Ethiopian Electric Power had signed power-purchase agreements with roughly 21 mining firms, predominantly foreign-owned. Electricity priced at approximately 3.1 US cents per kilowatt-hour attracted major global operators, including BIT Mining, Bitdeer, Canaan, and BitFuFu. The sector accounted for an estimated 2.25% of the global Bitcoin hash rate and generated roughly $220 million in utility revenue in 2025.
The Ethiopian Energy Outlook 2025 projected that crypto mining could consume a third of national power output, threatening domestic electrification goals. In August 2025, Ethiopian Electric Power froze new permits, and a tariff revision effective December 2025 raised mining electricity rates by 32%.
The immediate operational crisis is further compounded by severe drought. El Niño conditions reduced reservoir inflows by 20%, forcing the utility to cut power deliveries to miners to just 23% of contracted amounts by September 2026 to prioritize domestic grid stability.
