Stay connected with BizTech Community—follow us on Instagram and Facebook for the latest news and reviews delivered straight to you.
Three big Chinese companies—Bitmain, Canaan, and MicroBT—that have been the leaders in the Bitcoin mining equipment market are now moving some of their production to the United States.
This was done to get around the high tariffs that the Trump administration put on goods coming from China.
According to a report from Reuters on June 18, the US has put a 30 percent tax on goods coming from China.
China makes more than 90% of the world’s Bitcoin mining machines right now. This tax makes it easier for big tech companies to be competitive in the global market.
Bitmain was a pioneer when it started putting together devices in the US just a few weeks after Trump won the election.
Canaan also started developing a test production line there so they wouldn’t be left behind. “We want to cut costs for both us and our customers.” “We have to try everything,” said Leo Wang, Canaan’s Vice President of Business Development, in a hopeful tone.
MicroBT, the third largest player, is also not sitting still. As part of a plan to make the supply chain stronger during times of geopolitical conflict, they launched a “localization” plan in the US.
The Trade War Shakes Up the Crypto Industry
This choice is not only a short-term fix. Guang Yang, the CTO of Conflux Network, says that the trade war between the US and China has affected the crypto sector in a big way. “This isn’t just about taxes.” Companies are changing the way they think about their supply chains in a big way. “They want hardware that is less biased,” he said.
This move is actually a great chance for the US. Sanjay Gupta, Auradine’s Head of Strategy, talked about the long-standing gap.
“Think about it: North America has 30% of the world’s Bitcoin mining activity, but China makes 90% of the equipment. “It’s like demand and supply that never meet,” he remarked.
It really is amazing how these three Chinese companies are in charge. According to the Frost & Sullivan report, they had 95.4% of the world’s Bitcoin mining hashrate in 2023.
They are not only dealing with the tariff problem by constructing a plant in the US, but they are also starting a big change in the power dynamics of the crypto sector.
The US wants to be number one
The more businesses shift their production to the US, the better the US will be able to compete with China’s supremacy.
Right now, the difference in manufacturing capacity between the two countries is about 15%. The US has a chance to catch up now that more people want Bitcoin mining machines.
The US is no longer only a market; it is starting to become a place where crypto technology is made.
The US is working harder to establish a more self-sufficient ecosystem that can handle geopolitical challenges as factories move out of China.
This decision feels like a long-term bet in a world full of uncertainty. The US is changing the way the world gets its goods, making it a major player in the Bitcoin mining business. Who will be in charge in the future? Only time will tell.
