In the ongoing battle between America and China, the Trump administration has cranked up the import tariffs on Chinese crypto mining hardware. The trade war kicked off in the summer, as the Trump administration increased import tariffs on over 250 Chinese goods by up to 25%. In a bid to slow down China’s grasp on the crypto mining industry, the Trump administration has set its sights on bumping up the tariffs on crypto mining hardware. The new tariffs are designed to prevent American crypto mining firms using Chinese equipment, forcing the use of locally made hardware instead.
Taming the Red Dragon
In a bid to put America back on top, these new tariffs will completely put off American firms buying their hardware from China. Instead, they will either have to produce it at home or use hardware from other nations. The new tariffs on crypto mining hardware will bump import taxes up to a whopping 27.6%, whereas before this figure was zero. The plan is to stifle firms like Bitmain, by cutting down their international sales so they can no longer afford to develop new ultra-powerful ASIC mining chips to be used in China.
Revitalizing the American Crypto Mining Industry
Crypto miners in America have been faced with some serious challenges lately, mainly having new power applications put on hold. This means that new firms are struggling to open up in areas with low electricity costs, so they are looking to move elsewhere. However, the Permian Basin in Texas looks like it could produce a wealth of low-cost power for these crypto mining firms. Coupled with home grown crypto mining hardware, the American crypto mining industry could be back on top sooner than expected.
Trump Fears China
When it comes to cryptos, the Trump administration is very cautious about Bitcoin due to the fact that China holds the key to destroying the network. If China wanted to, it could either kill the network by banning all mining operations in the country effective immediately, or simply create a government order that means all mining firms have to give their hash rate to the government. Either scenario is bad for Bitcoin and the US government should it begin to use the crypto. Due to these concerns, Trump and his team are considering using Ripple as an alternative due to the fact it cannot be mind – queue cringing and backlash from the crypto community.
These controversial tariffs are great news for hardware manufacturers such as Bitfury – who should see a nice increase in sales due to its considerably lower price in America now. Trump and his administration are hoping to slowly take the crypto mining power away from China and keep it for themselves, meaning it’s much more likely to take on a crypto-friendly stance. The shift of power could take some time, but there is a real chance that America could quickly become the crypto mining capital of the world.