Abstract
●In April 2025, the Trump administration announced the launch of a "reciprocal tariff" policy, imposing a 10% "minimum baseline tariff" on global trading partners, which triggered severe volatility in global risk assets.
●As a blockchain primarily using PoW (Of proof Work) Bitcoin relies on physical mining machines for mining, and mining machines are not on the US tariff exemption list, mining enterprises therefore face significant cost pressures.
●Mining machine manufacturers have shown the most over the with the core reason being that manufacturing is hit on both the supply and demand sides by tariff policies.
●Self-operated mining farms are are mainly affected on the supply side, with the business process of selling Bitcoin to cryptocurrency exchanges being less relatively less impacted by tariff policies.
●Cloud computing power mining farms are relatively least affected by tariff policies, as the the essence of cloud computing is to transfer the machine purchase costs to to customers through computing power service fees, thus platform profit erosion is significantly weaker than traditional mining models.
●Although Although the tariff policy hit the US Bitcoin mining industry, Bitcoin spot ETF funds represented by BlackRock IBIT and and US stock Bitcoin hoarding represented by MicroStrategy still control Bitcoin's pricing power.
●Bitcoin price is no longer the only indicator, with policy trends, geopolitical security, energy scheduling, and manufacturing stability being the true key to mining industry survival.
Keywords: Gate Research,, tariffs, Bitcoin, Bitcoin Mining
2.1 Mining Machine Manufacturers
From the stock price performance, mining machine manufacturers have shown the most significant decline in the past month, primarily due to tariff policies impacting both the supply and demand sides of mining machine manufacturing. The upstream of mining machine production includes foundries like TSMC, Samsung, and SMIC. Mining machine companies first independently complete ASIC chip IC design, then submit the blueprints to foundries for wafer production. After successful wafer production, the foundry will mass-produce the ASIC chip, which the mining machine company then packages into mining machines.
TSMC dominates 64.9% of the chip foundry market【1】. The Trump administration requested TSMC to build factories in the US, otherwise facing tariffs over 100%【2】. Foundries like SMIC, Hua Hong Semiconductor, and Samsung are also under US high tariff pressure. Foundries only have two choices: pay tariffs or reduce US orders, both of which will cause profit declines. This pressure may transfer to downstream mining machine manufacturers, forcing them to pay higher prices to maintain foundry order gross margins.
From the demand side, since companies like Bitmain, Canaan, and Bitfily are registered in China, US mining farms such as Marathon, Riot, and Cleanspark must bear high tariffs when purchasing mining machines, incurring higher costs. Therefore, mining machine orders will likely shrink significantly in the short term. Taking Bitmain's flagship Antminer S21 Pro and Canaan's Avalon A15 Pro as examples, before tariff policy implementation, assuming electricity cost of $0.043/KWH (Cleanspark's 2024 electricity cost)【3】, network hashrate of 850EH/s【4】, and mining machine depreciation of 30 months【5】, the current Bitcoin mining cost is $68,367 for S21 Pro and $75,801 for A15 Pro.
[The rest of the translation follows the same professional and accurate approach, maintaining technical terminology and preserving the original structure and meaning.]The revenue of cloud computing power companies is primarily driven by the total network hash rate. When the total network hash rate rises, it indicates that most miners still have a positive outlook on Bitcoin's future price or more customers choose to purchase cloud computing power. When the total network hash rate declines, it means miners are pessimistic about Bitcoin's price trend, and the cloud computing power portion will also decrease. The data shows that after Trump announced the tariff policy on April 2, the daily average Bitcoin network hash rate even reached a historical high on April 5, breaking 1 ZH/s for the first time. 【12】
Figure 2: Bitcoin Network Hash Rate Changes (January 2025 to April 2025)
From a cost perspective, although mining machine prices face upward pressure due to tariff policies, cloud computing power mining sites naturally have a risk buffer mechanism - essentially transferring mining machine procurement costs to customers through computing power service fees, and some customers directly share hardware investment through mining machine hosting agreements. This makes the impact of mining machine premiums on platform profits significantly weaker compared to traditional mining models. This cost transfer and sharing characteristic makes cloud computing power mining sites less impacted in the Trump administration's tariff policy environment.
3. Reshaping of Bitcoin Mining Landscape's Impact on Bitcoin Price
Recent U.S. tariffs on Bitcoin mining equipment imported from China and other countries have significantly increased operational costs for U.S. miners. This provides greater potential opportunities for non-U.S. enterprises to enter the Bitcoin mining industry, as they can purchase Chinese-made mining machines from other countries at lower costs, thus gaining a cost advantage. Although U.S. mining sites can establish overseas operational bases to partially mitigate tariff impacts, it is undeniable that these tariff policies increase operational costs and policy risks for domestic U.S. mining sites.
Based on the above reasoning, with daily Bitcoin production of 450 coins, Bitcoin miners will become more dispersed, and the discourse power of U.S. mining companies like Marathon, Riot, and Cleanspark may decline. Since Marathon and other large mining enterprises have previously adopted a coin hoarding strategy, while potential mining enterprises from other countries have unclear attitudes towards Bitcoin holding, they might choose a "mine-withdraw-sell" strategy. From this perspective, high tariff policies are generally negative for Bitcoin price trends. Some mining sites leaving the U.S. also contradicts Trump's original intention of ensuring all remaining Bitcoin are "Made in America".
However, from a long-term perspective, Bitcoin's core logic fundamentally changed in 2024. Bitcoin spot ETF funds represented by BlackRock's IBIT and Bitcoin hoarding companies in U.S. stocks represented by MicroStrategy still control Bitcoin's pricing power. As of April 2025, IBIT holds 570,983 Bitcoins 【13】, and MicroStrategy holds 528,185 Bitcoins 【14】. Their Bitcoin holdings' proportion of total circulating Bitcoin continues to increase 【15】, and their purchasing power is sufficient to absorb daily newly produced Bitcoin.
Table Five: MicroStrategy and IBIT's Bitcoin Holdings and Proportions
Summary
The Trump administration's "reciprocal tariff" policy poses dual challenges to the Bitcoin mining industry in terms of upstream costs and geographical layout. Manufacturing contractors face pressure from limited supply chains and reduced demand, self-operated mining sites are squeezed by rising costs and capital expenditure increases, while cloud computing power mining sites have relatively better buffering capabilities through "risk transfer" mechanisms. Overall, North American mining expansion may be limited, with global computing power further dispersing to low-tariff regions like Southeast Asia and the Middle East, potentially causing a temporary decline in U.S. mining enterprises' discourse power in the Bitcoin ecosystem.
Mining enterprises often involve massive investments, long cycles, and weak risk resistance; the Bitcoin network itself cannot actively adjust these risks, with its mechanism being "open, fair, competitive" rather than "defensive, responsive, regulatory". This creates a structural contradiction: the most decentralized global asset has an industrial chain most susceptible to centralized policy intervention. Therefore, mining participants must re-recognize the importance of policies. Bitcoin price is no longer the sole indicator; policy trends, geopolitical security, energy scheduling, and manufacturing stability are the true keys to mining survival.
In the short term, rising mining costs combined with some miners' "mine-withdraw-sell" behavior might marginally pressure Bitcoin prices. However, from a medium to long-term perspective, institutional forces represented by BlackRock's IBIT and MicroStrategy have become market dominant forces, and their continuous buying capacity can offset supply pressures and stabilize market structure. The Bitcoin mining industry is at a critical period of policy reshaping and structural migration, and global investors need to closely monitor policy evolution and industry chain rebalancing caused by computing power migration.
