New tariff policy hits Bitcoin mining industry, US mining machine prices rise significantly

Original article by Jaran Mellerud

Original translation: TechFlow

Trump’s tariff policy will have a significant impact on the Bitcoin mining industry. The following is an analysis of the impact of this policy on the industry.

On April 2, Trump announced sweeping new tariffs on imported goods aimed at strengthening the U.S. trade balance. Southeast Asia was hit hardest, with far-reaching consequences for the Bitcoin mining supply chain. The region is home to most mining machine manufacturers, including major producers such as Bitmain, MicroBT, and Canaan.

Furthermore, since the United States accounts for 36% of global computing power, these tariffs could significantly impact the economics of miners, hardware prices both inside and outside the United States, and the global distribution of computing power.

Before we dive into the multifaceted impact these tariffs will have on the Bitcoin mining industry, let’s first briefly explain how tariffs work.

How do tariffs work?

Tariffs are taxes and fees imposed by governments on imported goods, usually to protect domestic industries by making foreign products more expensive. When tariffs are imposed, importers must pay a percentage of the declared value of the goods to customs when they enter the country.

For example, if a U.S. company imports $1,000 worth of electronics from China and the tariff rate is 54%, the importer must pay an additional $540 in tariffs, bringing the total import cost to $1,540. This increased cost is typically passed on to consumers or reduces the importers profit margin.

Tariff History: The US-China Trade War and Its Chain Reaction

Bitcoin mining is a global industry in which the United States is a major player, and the trade war and the tariffs it has induced have had an impact on the industry. However, historically, companies in the industry have found ways to circumvent these tariffs. In the following sections, we will explore how tariffs have historically affected the Bitcoin mining supply chain and what strategies companies have adopted to circumvent these tariffs.

In 2018, the U.S. government imposed 25% tariffs on a range of Chinese goods, including electronics, as part of the trade war between the United States and China.

In response, companies like Bitmain began looking for ways to circumvent these high tariffs by moving production from mainland China to Southeast Asian countries such as Indonesia, Thailand and Malaysia, which either exempt goods from tax or pay lower tariffs when exporting to the United States – usually between 1% and 3% for electronics.

This strategy worked well until earlier this month, when Trump increased tariffs on imports from Indonesia, Malaysia, and Thailand to 32%, 24%, and 36%, respectively. As a result, companies like Bitmain and MicroBT can no longer fully avoid these high tariffs, which were initially only applied to goods imported from China.

In the following sections, we will explain in detail how these newly implemented tariffs will affect the Bitcoin mining industry.

Mining machine prices in the United States will rise sharply

The most direct and obvious impact of tariffs is that the price of mining machines in the United States will increase significantly.

As Ethan Vera noted on The Mining Pod: “…any company operating in the U.S. that wants to buy mining machines is going to need to pay an additional 22% to 36% for those machines.” This is consistent with our data.

However, the 22% price increase only applies to imported mining machines. Currently, there is still a large inventory of mining machines in the United States. According to Bitmars pricing data, there is currently a 13% to 25% price difference between mining machines in the United States and mining machines in Hong Kong. As the US inventory decreases, this price difference may narrow to 22%, plus a small amount of shipping costs.

The chart above shows the final cost of importing a $1,000 Bitcoin mining rig into the United States and Finland before and after the introduction of reciprocal tariffs. Finland, like most other countries, has no tariffs on electronics imported from Asia – we use that country as an example because we mine there.

As shown in the figure, the cost of importing a mining machine into the United States was slightly higher initially due to the tariff of about 2%. However, after the new tariffs were introduced, the minimum cost of a mining machine that originally cost $1,000 in the United States rose to $1,240. This is a significant increase. Meanwhile, in Finland and most other countries, the cost of a $1,000 mining machine remained the same due to the absence of tariffs.

In an industry as cost-sensitive as Bitcoin mining, a 22% increase in mining machine prices could make operations financially unsustainable. Later in this article, we’ll explore how these changes affect mining profitability in the U.S. and elsewhere.

Mining equipment may become cheaper outside the U.S.

As mining prices rise within the United States, mining prices in other parts of the world may see an opposite downward trend.

Demand for mining machines shipped to the United States is expected to drop significantly, possibly even close to zero. Considering that the United States has been the dominant player in the ASIC (application-specific integrated circuit) market, accounting for nearly 40% of global computing power, a sharp drop in U.S. purchases will lead to a significant reduction in global demand.

As demand from U.S. miners wanes, manufacturers will be faced with excess inventory that was originally intended to supply the U.S. market. To clear that inventory, they may need to lower prices to attract buyers from other regions.

While it’s difficult to predict exactly how much mining prices will drop — since mining profitability also affects prices — we can conclude based on basic economic principles: reduced demand for an asset generally leads to a drop in its price.

This price drop will make it easier for miners outside the United States to continue expanding, which may also lead to the decline in the United States’ share of global computing power that we will discuss next.

U.S. share of global Bitcoin mining to decline

The United States has been the dominant force in Bitcoin mining since China banned Bitcoin mining in 2021. According to data from Hashrate Index, the United States currently accounts for 36% of the global computing power.

As with any business activity, Bitcoin mining is all about balancing risk and reward. Over the past four years, the United States has attracted a large amount of mining investment because it is seen as one of the lowest-risk environments in the world, with political stability, abundant energy, and a liberalized electricity market. In addition, miners have so far avoided major import tariffs, which has helped them control capital expenditures. These factors together create an unparalleled risk-reward balance.

To understand how the new tariffs could reshape the U.S. share of global mining, we first analyze it from the perspective of returns.

The chart below shows the estimated payback period for deploying an Antminer S 21+ in the US and a country not affected by the tariffs. As the data shows, paying 24% more for the same miner in the US will significantly extend the payback period – undermining the core economic rationale for mining in the US.

In addition to higher mining machine costs, the risk side has also taken a hit. Many US miners took comfort when Trump returned to power, expecting a stable regulatory environment. But they are now experiencing the other side of his volatile policies. Even if these tariffs are reversed in a few months, the damage has been done – confidence in long-term planning has been shaken. Few will be willing to make major investments when key variables can change overnight.

In summary, the once unparalleled risk-reward balance of U.S. bitcoin mining has deteriorated significantly. This change could lead to a gradual decline in the U.S. share of the global mining industry relative to other countries.

Of course, existing mining rigs already imported into the U.S. won’t be affected — miners have no reason to shut them down. But the path to expansion now becomes steep and fraught with uncertainty.

Meanwhile, miners in tax-free jurisdictions will continue to expand and consolidate their competitive advantage. As a result, the United States’ share of global hashrate is expected to decline—not because miners quit, but because they are no longer growing.

From a broader perspective, this could lead to a more diverse geographic distribution of Bitcoin mining than ever before. While the United States will remain a major player, its dominance will weaken and global hashrate will be more evenly distributed. This is consistent with the predictions of Braiins’ Kristian Csepcar and Bitmars’ Summer Meng .

Network computing power growth will slow down

In the previous section, we explained how the new tariffs would lead to a decline in the U.S. share of the global Bitcoin mining industry. Given the U.S.’s large role in global hashrate, a slowdown in its growth — or even a complete halt — would inevitably lead to an overall slowdown in global hashrate growth.

According to Hashrate Index, the United States accounts for approximately 36% of global hashrate as of the second quarter of 2025. In contrast, CBECI data shows that the United States accounts for approximately 38% of hashrate in January 2022. This suggests that the U.S. mining industry has grown at roughly the same rate as the rest of the world over the past three years.

Assuming this growth trajectory would have continued, the U.S. would have contributed about 36% of future global hashrate growth. Therefore, if U.S. mining were to stagnate due to tariffs, it could reduce global hashrate growth by up to 36%.

However, it is highly unlikely that the U.S. mining industry will stop growing completely. As we will explain in the next section, these tariffs are likely to be temporary and there may be ways to circumvent them in the future. Therefore, a more realistic expectation is that the U.S. mining industry will continue to expand, but at a much slower pace than before. The assumption of a 36% reduction in global hashrate growth should be viewed as an absolute upper limit – the actual impact may be slightly lower.

In the long run, if U.S. growth slows or stagnates, miners in other countries may accelerate their expansion and gradually fill the gap.

Nonetheless, in the short to medium term — within the next year or two — we may see slower growth in global hashrate than previously expected. In an industry where slower hashrate growth means higher revenues, this would be a welcome development for miners around the world.

Is this temporary or permanent?

So far, this article has taken a fairly pessimistic view of how these tariffs will affect the U.S. Bitcoin mining industry — and that’s reasonable, given the immediate and severe impact they are likely to have. However, the picture is more complex, and there are some important questions worth exploring.

In the following sections, we answer these questions and assess how the long-term outlook for the U.S. mining industry stacks up against current challenges.

Will Trump remove tariffs months after implementing them?

It’s entirely possible — especially given the unpredictable and reactive nature of Trump’s policymaking style — that if the tariffs were rescinded, U.S. miners would once again be able to import machines at competitive prices, relieving many of the immediate pressures they face.

However, the damage to long-term investor confidence may have already been done. Even if the tariffs are lifted, the fact that they were introduced so abruptly makes it more difficult to make large, long-term investments in the U.S. mining industry. In an industry as capital-intensive as Bitcoin mining, policy stability is crucial — and right now, that’s what’s scarce.

Can mining machine manufacturers circumvent tariffs by importing chips from Taiwan and assembling mining machines in the United States?

It is indeed possible that mining machine manufacturers could circumvent tariffs by importing chips from Taiwan and assembling mining machines locally in the United States. According to official statements from the White House, semiconductors are not subject to reciprocal tariffs. This means that chips can be imported into the United States duty-free. However, local production of mining machines in the United States still requires other components, many of which have become more expensive due to tariffs, which will lead to overall inflation in the US economy.

Currently, manufacturers such as MicroBT have established assembly lines in the United States, but Bitmain has not followed suit. Even with MicroBTs assembly capabilities, its production capacity is far from enough to meet the demand for mining machines in the United States in the next 1-2 years.

Therefore, while this option is technically feasible, it does not solve the immediate problem for U.S. miners. However, in the long term, we expect more mining machine assembly to gradually shift to the United States as manufacturers adapt to the new tariff environment and expand local production capacity. This shift may help reduce dependence on international imports and reduce the impact of tariffs over time.

Is it realistic to establish a complete Bitcoin mining hardware supply chain in the United States, from chip manufacturing to final assembly?

Establishing a complete bitcoin mining hardware supply chain from chip manufacturing to final assembly in the United States is a complex challenge, despite a strong push from both the bitcoin mining industry and political leaders to localize chip production. Currently, the most advanced chips used in bitcoin mining are produced in Taiwan and South Korea, regions with decades of expertise and finely tuned supply chains. The United States reliance on Asian countries for key components is a major geopolitical risk not only for the bitcoin mining industry, but for the entire high-tech industry.

While localizing mining machine assembly in the U.S. is feasible, continued reliance on imported chips is a major obstacle. Companies like Bitmain, MicroBT, and Canaan could set up assembly lines in the U.S., and new players like Auradine are eyeing the market. However, without locally produced cutting-edge chips, these manufacturers will remain dependent on imports for the foreseeable future.

Kristian Csepcsar of Braiins further highlighted this challenge, saying, Chip foundries have established manufacturing facilities in the U.S., but they started at the high-nanometer level. It takes years to build up the talent and expertise to move to lower nanometer levels. The process is incremental — companies start with high-nanometer chips to ensure the investment is profitable, and then work to expand to more advanced technologies. Even if the U.S. moves forward, building a fully localized supply chain for Bitcoin mining hardware will be nearly impossible and the costs will be very high. The real question is whether it will still be cheaper to manufacture in China and pay the tariffs if demand is high. After all, it takes time and a lot of investment to launch end-to-end manufacturing in the U.S., as Bitmain recently tried to set up an assembly line in China — although there hasn’t been much news since.

In short, despite the great potential of the United States in assembly and chip manufacturing, a fully localized Bitcoin mining hardware supply chain remains a long-term goal rather than a short-term reality. The cost, time, and complexity of this transition make it unlikely to be achieved at scale in the next few years.

in conclusion

In summary, the newly implemented tariffs on imported goods will significantly impact the U.S. Bitcoin mining industry—leading to higher hardware prices, lower U.S. market share, and slower global computing power growth—but the long-term impact is more complex.

As the situation develops, miners and industry stakeholders need to keep a close eye on the political and economic landscape to prepare for potential tariffs and policy changes. The U.S. mining industry may face challenges in the short term, but there are opportunities for growth and adaptation in the global mining ecosystem.

This article is sourced from the internet: New tariff policy hits Bitcoin mining industry, US mining machine prices rise significantly

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