Trump’s Tariffs: Crypto Mining’s Unlikely Victim

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Recent tariffs imposed by President Donald Trump on imports from Canada, China, and Mexico are expected to have varying impacts on the cryptocurrency mining sectors in these countries.

U.S. and China

The U.S. has announced a 25% tariff on Canadian and Mexican imports and a 10% tariff on Chinese goods, effective Feb. 1, 2025, according to the Associated Press.

While these tariffs primarily target traditional industries, the cryptocurrency sector may experience indirect effects.

Here’s why: Most U.S. mining hardware is imported, making miners vulnerable to changes in trade policies or tariffs affecting these key suppliers.

And increased costs of imported mining hardware could lead to higher operational expenses for U.S. miners who primarily source their gear from international suppliers. Bitmain and Canaan are based in Beijing and Hangzhou, China, respectively. They are the largest manufacturers of ASIC (Application-Specific Integrated Circuit) miners and GPUs (Graphics Processing Units).

Hsinchu-based Taiwan Semiconductor Mfg. Co. produces semiconductor chips used in mining rigs, which are sourced by companies like Bitmain.

MicroBT, which is based in Shenzhen, China, has a U.S. segment that produces mining hardware domestically. Therefore, the company — which partnered with Riot Platforms Inc. and manufactures miners at a facility in Pittsburgh, Pennsylvania — could potentially avoid certain import tariffs on Chinese-made products.

Canada and Mexico retaliate

Canada has been a significant player in global Bitcoin mining, with its share of the global hash rate varying over time. As of September 2023, Canada reportedly accounts for about 7% of the global Bitcoin mining hash rate.

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😜 Oh, the irony! Trump’s tariffs may have unintended consequences for the crypto mining industry. 💸 Meanwhile, Canada and Mexico are fighting back with their own tariffs. 🇨🇦🇲🇽 Who knew a trade war could affect the world of digital currencies? 🤯

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2025-02-02 23:28