The largest Chinese bitcoin mining rig manufacturers, Bitmain, Canaan, and MicroBT, have begun relocating their production to the US. This decision is linked to new tariffs on imports instituted during the trade war between the US and China.
Shift of Production to the US
All three companies, which control over 90% of the world's mining rig market, have decided to move their production from China to the US. Bitmain was the first to start assembling equipment in the US in December 2020, with Canaan following suit by launching test production in the US.
Reasons and Consequences of the Move
The move is due to new tariffs that can significantly increase the production costs of equipment. Leo Wang, Canaan's VP, stated that the US project is 'exploratory' due to the unpredictable trade policy. MicroBT also announced the implementation of a 'localization strategy' in the US to avoid financial losses.
Prospects for the American Crypto Market
These three companies dominate the upper echelons of the global crypto industry and produce the equipment needed for bitcoin mining. Sanjay Gupta, Chief Strategy Officer of Auradine, pointed out that over 90% of mining hardware originates from China, creating a significant imbalance between supply and demand in North America.
The transition of Chinese bitcoin mining rig manufacturers to the US may change the market structure, but risks associated with reliance on Chinese technology remain relevant.
