Original title: A False Start on the Road to an All-American Bitcoin
Original author: Joel Khalili, Wired
Original translation: AididiaoJP, Foresight News
Trump’s Bitcoin Mining Ambitions
Trump once promised to make the United States the worlds capital of Bitcoin mining. However, the recent comprehensive tariff policy has put this ambition in a dilemma.
President Donald Trump paused to enjoy the applause from the audience. At the Bitcoin 2024 cryptocurrency conference, facing the cheers of a group of enthusiastic Bitcoin believers, he outlined his plan to make the United States a Bitcoin mining superpower.
“I’m going to have bitcoin mined, minted and produced in the United States,” he told the crowd. “You’re going to be very happy with me — you’re going to be very happy.”
Since returning to the White House, Trump has largely fulfilled his campaign promises: he has set about building a national bitcoin reserve, replaced the head of the regulator that was most harsh on crypto companies in the previous administration, and appointed a crypto czar to set clear regulatory rules for the industry. However, in the key area of bitcoin mining, the US presidents approach so far has been full of contradictions, supporting local mining companies on the one hand and increasing the industrys operating costs through tariff policies on the other.
The two sides of tariff policy
On April 2, Trump announced new punitive tariffs on 57 countries, including tariffs on goods from China (later adjusted to 55%), and tariffs of 24% to 36% on Indonesia, Thailand, and Malaysia (Chinese companies produce some mining machines in these three countries). This policy has caused American mining companies that rely on Chinese suppliers, including the Trump family’s newly established mining company American Bitcoin, to face the challenge of soaring hardware costs.
However, these tariffs also offer a silver lining: They could bolster small domestic mining rig manufacturers, as U.S.-made mining rigs are not subject to the new import duties.
Whether U.S. hardware manufacturers can truly seize this opportunity depends largely on their potential customers and whether U.S. mining companies can withstand the economic impact of tariff policies.
To ensure a stable supply chain, mining companies usually sign long-term purchasing agreements with hardware manufacturers. Now these companies have to face a thorny problem: they may need to pay high tariffs on orders of Chinese mining machines that have not yet been delivered.
Faced with the pressure of rising costs, many US mining companies have begun to adjust their business direction and turn to artificial intelligence (AI) and other data center businesses to seek more stable sources of profit. This trend puts the vision of a Bitcoin superpower that is mined by US companies in the United States using US-made mining machines at risk of being aborted at the start.
If things continue like this, mining will continue to be squeezed out of the U.S., said Chris Bendiksen, director of bitcoin research at investment firm CoinShares. We may have seen peak mining in the U.S..
In a statement to WIRED, White House spokesman Kush Desai pushed back against the idea that tariffs could undermine Trump’s bitcoin mining ambitions.
“We can do two things at the same time,” he said. “We can use tariffs to promote localization of hardware manufacturing, and we can use energy policy to reduce the operating costs of Bitcoin mining companies.”
Bitcoin Mining’s Hardware Arms Race
Bitcoin mining is essentially a hardware arms race. Miners must constantly upgrade their equipment to ensure that their computing power is sufficient to beat their competitors and win the right to process transaction blocks and receive Bitcoin rewards.
In this field, two Chinese manufacturers, Bitmain and MicroBT, have almost monopolized the global market. The Cambridge Centre for Alternative Finance (CCA), an institution affiliated with the University of Cambridge, estimates that these two companies together control 97% of the mining machine market share.
Although a number of challengers have tried to break the duopoly over the past few years, none have been able to achieve breakthroughs in hardware performance or production costs. The road is littered with the bodies of failures, Bendiksen commented.
The new tariff policy has forced many American mining companies that rely on Chinese mining machines to review their supply chain strategies and look for alternatives.
Analysts believe that Santa Clara-based mining machine manufacturer Auradine may be one of the biggest beneficiaries. The company has been struggling to shake the market position of Bitmain and MicroBT in the three years since its establishment. However, Auradine has seen a surge in customer inquiries since Trump announced the new tariffs.
“We’re seeing unprecedented interest from the market,” said Rajiv Khemani, co-founder and CEO of Auradine. “Miners want to make sure they are hedged against tariff risk in any policy environment.”
To seize this opportunity, Auradine recently launched a new generation of Bitcoin mining machine product line and raised $153 million in Series C funding. Hemani revealed that the company is about to announce a number of high-profile customers signed after the tariff policy.
MARA Holdings’ layout
One of Auradines star clients is MARA Holdings, a US-listed mining company that not only participated in the creation of Auradine but also holds an $85.4 million stake in the company.
MARA CEO Fred Thiel said that although Auradines mining machines currently only account for a small part of the companys operating equipment, Auradines products account for about 50% of new orders in 2025.
In an environment where geopolitical risks and tariff risks coexist, if the price of a mining machine made in the United States is the same as that of a mining machine made in China, what would you choose? The answer is obvious, Thiel said. If the US government suddenly bans the import of Chinese mining machines one day in the future, and you have already paid a deposit of $300 million for an order, you will be in a very passive position.
However, whether Auradine can truly benefit from the tariff policy still depends on whether US miners can withstand the impact of tariffs on their existing orders.
The current timing is even worse for mining companies. Although the rise in Bitcoin prices has brought certain profit margins, factors such as increased industry competition, falling transaction fees, and reduced Bitcoin block rewards have significantly compressed mining companies profit margins.
At the same time, mining companies are also facing fierce competition from AI companies, which, with sufficient financial strength, are robbing the limited energy resources in the United States. The latest forecast of the U.S. Department of Energy shows that by 2028, the power consumption of the AI industry may reach 22% of the electricity consumption of all U.S. households.
Bitcoin mining companies operating in the United States, including Riot Platforms, Bitfarms, MARA, CoreWeave, Core Scientific, Hut 8, Iris Energy, etc., have sought to diversify, exit the mining market, and transform their facilities to adapt to artificial intelligence training and high-performance computing. Only a few large companies (such as CleanSpark) are still focused on Bitcoin mining.
Miners have always been savvy buyers of electricity, like vultures on the grid, Bendiksen said. But now, AI companies are willing to pay higher electricity prices, and the living space of mining companies is being further squeezed.
MARA CEO Thiel believes that tariff increases alone are not enough to force Bitcoin miners to leave the U.S. Compared with energy costs, hardware import tariffs have a relatively small impact on the overall operating costs of mining companies.
However, in an already challenging market environment, the cumulative effect of tariff policies has undoubtedly exacerbated the industrys difficulties.
Typically, this kind of shock leads to the beginning of consolidation in the industry, said Thiemo Fetzer, professor of economics at the University of Warwick. We are likely to see small miners eliminated as rising equipment costs and increased supply chain uncertainty make it more difficult for them to survive.
Global layout of mining companies
Faced with challenges in the US market, many mining companies have begun to expand their businesses overseas to avoid tariff risks.
“Why do we want to develop international business? Because it can reduce the risk of a single policy.” “As a Bitcoin miner, you have to be flexible.”
At the same time, Chinese mining machine manufacturers Bitmain and MicroBT are also accelerating their layout of domestic production in the United States to bypass tariff barriers.
“We are actively investing in the U.S. market, including local manufacturing,” said Irene Gao, president of Bitmain’s mining business.
Currently, Bitcoin mining companies are generally in a wait-and-see mode. Before the 90-day suspension period of Trump’s new tariffs ends in July, its ultimate impact remains unclear, and many companies have therefore postponed hardware purchasing decisions.
“Everyone is waiting to see how the tariffs will play out,” Hermani said.
The contradictions of Trump’s policies
On the surface, Trump’s tariff policy runs counter to his ambitions to boost the U.S. bitcoin mining industry.
“These tariffs are clearly disruptive,” Bendiksen said bluntly.
To achieve two goals at the same time: supporting American mining machine manufacturers and ensuring the viability of mining companies in the United States, the Trump administration may need to use other policy tools, such as promoting energy infrastructure construction to reduce mining companies electricity costs.
The White House claims that a series of recent executive orders will help lower U.S. energy prices. However, the reality is that many mining companies are still reducing their domestic operations and turning to AI or other fields.
“Trump’s promise of ‘Bitcoin for All of America’ seems like just empty rhetoric at this point,” Bendiksen concluded. “It’s more about pandering to nationalist sentiment than real industrial policy.”
