A new round of US tariffs under former President Donald Trump is causing major headaches for Bitcoin miners. With mining equipment imports subject to steep new taxes, the once-thriving industry is feeling the strain. Many miners are now considering expanding their operations overseas in search of more cost-effective alternatives.
What will the new tariffs mean for Bitcoin miners?
Bitcoin miners in the United States are feeling the heat as Donald Trump’s latest round of tariffs, announced on July 31, targets imported mining hardware.
The new policy imposes a 21.6% tariff on ASIC machines imported from key Southeast Asian countries such as Malaysia, Thailand, and Indonesia. These machines are essential to cryptocurrency mining operations and were previously taxed at only 2.6%.
Ethan Vera, COO of Luxor Technology, told The Block that the tariff includes a 19% “reciprocal” fee, making it more difficult for US-based miners to remain competitive. China, another major supplier of mining rigs, is already facing a 57.6% tariff on its hardware.
With the current tariff pause between the United States and China set to expire on August 12 and no new agreement in sight, things are only getting worse for cryptocurrency businesses.
Are miners shifting their operations abroad?
The increase in import taxes has made the United States one of the least cost-effective places to import mining rigs. Many mining companies are now looking to Canada and other international markets as alternatives to avoid high import duties, as per a report by The Street.
Could domestic mining rig manufacturers benefit from this?
There might be a silver lining. Due to limited imports, the price of used ASIC machines currently available in the United States may rise. This could provide a temporary advantage to local sellers.
Luxor also hinted that there might be more rig manufacturing in the US, but they said it would take time. Most of the raw materials and parts still come from Asia, so full domestic production is a long-term goal, not something that can be done right away.
The crypto community is now waiting to see if the Trump administration will provide any exemptions for mining equipment to help the US blockchain industry. Until then, pressure on miners is unlikely to subside.
Also read: Bitcoin Price Drop: Is BTC Recent Drop a Sign of an Impending Crash or Just a Normal Correction?
