The Impact of Tariff Policies on Bitcoin Mining: Rising Costs and Reshaping the Landscape

Summary

In April 2025, the Trump administration launched a "reciprocal tariff" policy, imposing a uniform "minimum benchmark tariff" of 10% on global trade partners, triggering significant volatility in global risk assets. The Bitcoin mining industry, which relies on physical mining machines, faces considerable cost pressures. Mining machine manufacturers are impacted by shocks on both the supply and demand sides, with the most significant declines. Self-operated mines are mainly affected by the supply side, while large mining farms are less impacted due to their coin hoarding strategies. Cloud computing mining farms are relatively less affected due to their cost transfer mechanisms.

Tariff policies have struck a blow to the Bitcoin mining industry in the United States, but institutions represented by BlackRock's IBIT and MicroStrategy still hold the pricing power of Bitcoin. Bitcoin prices are no longer the sole indicator; policy trends, geopolitical security, energy scheduling, and manufacturing stability have become key factors for the survival of the mining industry.

Introduction

On April 2, the Trump administration announced a "reciprocal tariff" policy, imposing a 10% "minimum baseline tariff" uniformly on global trade partners and additional "personalized" high tariffs on countries with significant trade deficits. This policy triggered severe volatility in global risk assets, leading to a substantial shrinkage of assets in the cryptocurrency industry. China announced an 84% retaliatory tariff on the U.S., while the EU imposed a 25% tariff on 21 billion euros worth of U.S. goods, causing the global stock market to lose over 1 trillion dollars in value in just one week.

On April 9, Trump announced a 90-day suspension of tariffs on 75 countries excluding China, and the EU simultaneously suspended tariffs and initiated negotiations. On the same day, the S&P 500 rose by 9.51%, the Nasdaq rose by 12.02%, and the Bitcoin price rebounded by 8.19% to $82,500.

Bitcoin mining, due to its strong dependence on hardware, broad global supply chain span, and high capital intensity, has become one of the on-chain economic modules most directly affected by tariff policies. The global trade frictions caused by the U.S. reciprocal tariffs have posed multiple impacts on the crypto mining industry. The China-U.S. tariff war has raised the import costs of mining machines, compressing the expansion plans of North American mining farms. The depreciation of the RMB has intensified the U.S. dollar debt pressure on Chinese mining companies, compounded by fluctuations in electricity and energy prices, leading to a continuous rise in operating costs. At the same time, fluctuations in coin prices affect miners' income.

On a macro level, concerns over stagflation from the Federal Reserve combined with risk aversion have led to high 10-year U.S. Treasury yields, suppressing risk appetite. The tightening financing environment has caused mining company stock prices to decline alongside the tech sector. Against a backdrop of geopolitical tensions, the global mining landscape is facing reconstruction, and companies may accelerate their shift to tariff-friendly regions such as Southeast Asia and the Middle East. In the short term, policy uncertainty will continue to amplify Bitcoin mining risks, and the industry may enter a new round of reshuffling.

1. Bitcoin mining faces direct impact from tariff policies, with most related companies' stock prices dropping more than the NASDAQ 100 index.

Bitcoin, as the main public chain adopting the PoW mechanism, is widely regarded as "digital gold". The PoW mechanism relies on physical mining machines for mining, and mining machines and their upstream key components, such as semiconductors, are not on the list of tariff exemptions, leading to significant cost pressure for related mining enterprises. The upstream impact brought by tariff policies may indirectly affect the medium- and long-term trend of Bitcoin prices through cost transmission mechanisms.

The main ecosystem of Bitcoin mining includes mining machines, self-operated mining farms, and cloud computing mining farms. Mining machine companies include Bitmain, Canaan Creative, Bitmicro, and Ebang International, with major factories located in mainland China. Self-operated mining companies such as Marathon Digital, Riot Platform, and Cleanspark are headquartered in the United States, but their mining farms are distributed across multiple countries. Cloud computing mining farms mainly include Antpool, Bitdeer, BitFufu, and Ecos.

Affected by Trump's tariff policy, the stock prices of Bitcoin mining-related companies have declined, with drops exceeding the Nasdaq 100 index. Data shows that since the announcement of the tariff policy on April 2, the mining machine sector has seen the most significant decline, with Canaan Creative down over 17% and Ebang International down over 11%. The self-operated mining sector follows, with Core Scientific leading the decline, dropping more than 10% in the past month. Cloud mining farms are less affected, with BitFufu only down 5.9%. The referenced NASDAQ 100 index dropped by 2.2%.

2. Analysis of the Impact of Tariff Policies on Various Sectors of Bitcoin Mining

2.1 Mining Hardware Manufacturers

Mining machine manufacturers have experienced the most significant decline in the past month, due to the impact of tariff policies on both the supply and demand sides. Upstream foundries are facing high tariff pressures, which may be passed on to mining machine producers. On the demand side, U.S. mining sites face high tariffs when purchasing mining machines, leading to a contraction in orders.

In the long term, mining machine manufacturers may prioritize capacity layout in regions with friendly tariff policies, employing a global capacity allocation strategy to avoid potential tariff risks and achieve optimization of supply chain costs.

2.2 self-operated mining farm

Self-operated mining farms are mainly influenced by the supply side, and the business of selling Bitcoin to exchanges is less affected by tariff policies. Large mining farms like Marathon adopt a hoarding strategy, which is relatively less impacted by the decline in Bitcoin prices. Small mining farms, due to tight cash flow, may adopt a "mine and sell" strategy, which exacerbates market selling pressure.

In the long run, the depreciation cycle of mining equipment usually lasts 2.5 to 3 years, and self-operated mining farms need to continue capital expenditures. If the tax policy for mining machines is officially implemented, the cost pressure upstream will be transmitted to downstream mining farms, further increasing the marginal production costs in the industry, posing challenges to the profitability of small and medium-sized mining farms.

2.3 cloud computing power mining farm

The cloud computing power mining farm is essentially a rental model, mainly earning service fees paid by customers, without directly bearing the profits and losses brought by Bitcoin's rise and fall. Its income is mainly driven by the overall network computing power; when the overall network computing power rises, it proves that more customers choose to purchase cloud computing power.

From the perspective of cost, the leasing business model of cloud computing power mining farms has a risk buffering mechanism, transferring the cost of purchasing mining machines to customers through computing power service fees, making the erosion of platform profits by mining machine premiums significantly weaker than traditional mining models. This characteristic makes cloud computing power mining farms a field less affected by tariff policies.

3. The Impact of the Reshaping of Bitcoin Mining Landscape on Bitcoin Prices

The United States has imposed tariffs on imported mining machines, leading to a significant rise in operating costs for American miners, which provides opportunities for non-American companies to enter the Bitcoin mining industry. The increased operating costs and policy risks for domestic mining operations in the United States may lead to a more decentralized Bitcoin output, and the influence of American mining companies may decline.

In the long term, the core logic of Bitcoin will undergo fundamental changes in 2024. Institutions represented by BlackRock's IBIT and MicroStrategy still hold the pricing power of Bitcoin. As of April 2025, IBIT holds 570,983 Bitcoins, and MicroStrategy holds 528,185 Bitcoins. The holdings of both continue to increase as a proportion of the total circulating Bitcoin supply, and their purchasing power is sufficient to absorb the new Bitcoins produced each day.

Summary

The Trump administration's "reciprocal tariff" policy poses a dual challenge to the Bitcoin mining industry in terms of upstream costs and geopolitical layout. Mining machine manufacturers are under the most pressure, with self-operated mining farms facing the dual squeeze of rising costs and increasing capital expenditures, while cloud computing mining farms have relatively more buffering capacity. The expansion of mining in North America may be limited, and global computing power could further disperse towards low-tariff regions, potentially leading to a temporary decline in the voice of U.S. mining companies within the Bitcoin ecosystem.

Mining participants must re-recognize the importance of policies. Bitcoin's price is no longer the only indicator; policy trends, geopolitical security, energy scheduling, and manufacturing stability have become key to the survival of mining. In the short term, rising mining costs may pose marginal bearish pressure on Bitcoin's price; however, in the medium to long term, institutional forces have become the market's main drivers, and their continuous buying ability is expected to hedge supply pressure and stabilize market structure. Bitcoin mining is currently at a critical period of policy reshaping and structural transition, and global investors need to closely monitor the rebalancing of the industry chain brought about by policy evolution and computing power migration.