The bitcoin mining hardware market is an oligopoly dominated by two Chinese companies—Bitmain and MicroBT—which together account for an estimated 97 percent of sales. After the US imposed steep tariffs on Chinese goods during Trump’s first term, those firms moved a proportion of manufacturing to Malaysia, Thailand, and Indonesia. But under Trump’s initial tariff announcement, these countries faced tariffs between 24 and 36 percent, too.

Meanwhile, a vicious combination of other factors—steep competition, a slump in transaction fees, diminishing bitcoin rewards, surging energy demand, and so on—have strangled margins for US-based mining companies.

Under these conditions, says Vera, the additional tariff cost threatens to undermine the economics of less well-capitalized bitcoin mining operations. “On the high end, adding [more than 30 percent] to your capital expenditure really destroys unit economics for mining,” he says.