Trump's Tariffs Could Lower Bitcoin Mining Rig Prices Outside the US, Says Mining Exec

The Trump administration's recently imposed global "reciprocal tariffs" could lead to a significant shift in the Bitcoin mining landscape. According to Jaran Mellerud, CEO of Hashlabs Mining, these tariffs might make crypto mining rigs cheaper for non-US miners, as manufacturers will likely look to offload surplus stock that was initially intended for the US market.

Mellerud explained in a report on April 8 that the tariffs could collapse US demand for mining rigs, forcing manufacturers to lower prices for international buyers. “As machine prices rise in the U.S., they could paradoxically decrease in the rest of the world,” Mellerud said, predicting that demand for shipping mining machines to the US will plummet, potentially reaching near zero. To offload excess stock, mining rig manufacturers will need to lower prices, creating an opportunity for non-US mining operations to scale up.

The Impact of Tariffs on Global Mining Rig Prices

The new tariffs, announced on April 2, target nearly every country and have a direct impact on major crypto mining machine makers based in countries such as Thailand, Indonesia, and Malaysia. These countries are among the hardest hit, with tariffs ranging from 24% to 36%. Crypto mining giants like Bitmain, MicroBT, and Canaan have previously moved their manufacturing operations to these countries to bypass the 25% tariff imposed on China in 2018.

Source: Jaran Mellerud

Under the new tariffs, a mining rig that originally costs $1,000 in the US could see a price increase of 22%, reaching $1,240. In contrast, countries like Finland and other regions unaffected by the tariffs will see no change in the cost of the same rig. For Bitcoin miners, whose operations are heavily dependent on the cost of hardware, this price increase could be detrimental. Mellerud pointed out that even a small price hike could make mining operations financially unsustainable in an industry where every cost factor counts.

US Miners Face an Uncertain Future

While the immediate impact may not cause US miners to unplug their machines, Mellerud believes that the path to growth for US-based miners is now uncertain. “The damage is done,” he said, emphasizing that the long-term confidence of US miners has been shaken by the unpredictable nature of the Trump administration’s policies. Even if the tariffs are reversed in the near future, Mellerud doubts that the trust in a stable regulatory environment can be restored.

US miners had previously been optimistic when Trump returned to office, expecting a more predictable policy landscape. However, the latest tariff shift has highlighted the volatility that can affect the crypto mining industry. Despite the uncertainty, the US still accounts for nearly 40% of Bitcoin's network hashrate. Mellerud does not anticipate a significant drop in the total Bitcoin hashrate from the US, but he does expect that the country may lose a considerable share of mining power moving forward, as expansion becomes more challenging.

Annual change in US tariffs on China, Indonesia, Malaysia and Thailand since 2017. Source: Hashlabs Mining

Broader Market Effects

Trump’s tariffs are part of a broader shift in global trade policies that have affected nearly every market, including the crypto sector. In the wake of the tariff announcements, Bitcoin’s price has seen a dip, falling 4% in the past 24 hours to $76,470, according to CoinGecko data. This drop brings Bitcoin to 30% below its all-time high of $108,786, set on January 20, the same day Trump re-entered the White House. As these global trade tensions continue to evolve, the long-term impact on the crypto market remains to be seen, but miners and investors alike are facing an increasingly unpredictable environment.

In conclusion, while the immediate effect of the new tariffs may not be catastrophic for US-based miners, the uncertainty surrounding future policy shifts could have long-term consequences for the industry. As non-US miners benefit from falling prices, the US could see its dominance in Bitcoin mining erode unless conditions stabilize.