U.S. Bitcoin Miners Struggle With Tariffs, ETFs

Bitcoin mining companies in the U.S. face major operational challenges from both growing buying expenses and market valuation shifts, as shown in a Bitwise Asset Management study.

The Bitwise Industry Update details how severe conditions affect American miners. Countries such as Vietnam, Thailand, and Malaysia must deal with import duties between 24% and 46% on crypto mining device imports that they export to the USA because they provide important mining hardware.

According to the study, mining activities can no longer generate profits because hashprice stands at its lowest point in history. The new tariffs directly hurt worldwide cryptocurrency operations since U.S. miners represent about 40% of total network power.

Bitwise Warns of Mining Sector Strain

As expenses rise for crypto firms, they face growing problems acquiring funds for their business. The Bitwise report shows investors choose safer and simpler products like spot Bitcoin ETFs and crypto-based Treasury funds of Strategy and Metaplanet to satisfy their market participation needs.

According to Dragosch, miners must enhance their incentives to secure financing because investors favor investment opportunities through Bitcoin ETFs above traditional mining companies.

“These firms can accumulate BTC using low-cost equity issuance or convertible debt, offering investors immediate exposure to price appreciation without the operational risks of mining. This crowds out miners, who must finance heavy upfront capital expenditures, navigate uncertain regulatory terrain, and wait months or even years for their investment to pay off.” Bitwise

Multiple mining companies are now changing their strategies. Mining company Bitfufu and Bitmain partner consider setting up operations in Ethiopia because of the US trade restrictions. Bitdeer realigns its business strategy to Norway and Bhutan in order to generate profits.

Riot and CleanSpark built protection against tariffs by shipping their mining gear to customers rapidly before the new rules took effect.

Bitwise expects these stopgap strategies to hold back the market impact only temporarily. The report notes mining companies expect more difficult times ahead, which may force them to unite their operations and reduce costs through sectorwide changes.