[KUALA LUMPUR] Lauren Lin is in a hurry. She has less than 48 hours to ship about 5,600 Bitcoin mining machines from Thailand to the US before tariffs imposed on the South-east Asian country by President Donald Trump kick in.
“Today we’re just scrambling,” said Lin, head of hardware at Luxor Technology, a Bitcoin mining software and services company. “Ideally we can charter a flight and get machines over – just trying to be as creative as possible to get these machines out.”
Her efforts underscore the disruption the Bitcoin mining sector faces after Trump’s tariff announcement. The industry is caught in the middle of Trump’s trade war, with many of the largest miners based in the US and the supply chain rooted in Asia. Miners use specialised computers to solve mathematical puzzles for a chance to verify transactions and earn rewards in Bitcoin.
Trump said on Wednesday (Apr 3) that he would enforce a minimum 10 per cent tariff on all exporters to the US from Apr 5, while slapping additional duties on around 60 nations with the largest trade imbalances with the US. Thailand and Malaysia are subject to harsher levies of 36 per cent and 24 per cent, respectively, that will take effect on Apr 9.
Shares of US-listed Bitcoin miners including MARA Holdings and CleanSpark plummeted in after-hours trading following Trump’s tariff announcement. The latest tariffs will “suppress continued growth in the sector,” said Taras Kulyk, CEO at Synteq Digital, one of the largest mining machine brokers.
Beijing-based Bitmain Technologies, by far the largest manufacturer of Bitcoin mining equipment, has production lines in Indonesia, Malaysia and Thailand, Bloomberg News reported previously. It shifted manufacturing to the region after Trump set tariffs on electronics and other goods imported from China in 2018. Wednesday’s announcement means China will be charged a 34 per cent reciprocal tariff rate that could bring the average levy on Chinese products to as high as 65 per cent, according to economists.
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Bitmain did not immediately respond to a request for comment.
Crypto miners in the US have already faced delays receiving deliveries of new equipment since Trump’s election victory, after the Republican pledged on the campaign trail to nurture the industry to ensure that Bitcoin is “made in the USA.”
The industry’s manufacturing giants are trying to respond. On Dec 9, Bitmain announced the launch of a US facility, without disclosing its exact location. MicroBT, a rival Chinese manufacturer, has previously struck purchase agreements with Riot Blockchain that leverage the vendor’s US manufacturing sites, a Riot spokesperson told Bloomberg News earlier.
Luxor in December announced a US$131 million purchase agreement for MicroBT’s WhatsMiner machines – known as ASICs – in a deal it said aligned with MicroBT’s expansion in the US, which includes “the assembly of equipment onshore.”
Such efforts are unlikely to fully shield ASIC buyers from rising costs, though. “If new import duties hit key components, we could see higher capex for North American mining operators,” said Wolfie Zhao, head of research at industry publication the TheMinerMag. “That would add further pressure to an already cooling market.”
Machine cost is a substantial portion of crypto miners’ capital expenditure and operators now face a more than 20 per cent increase in purchasing expenses, Luxor’s Lin said. “That means their ROI will be impacted very heavily,” she added. BLOOMBERG
