- U.S.-China tariffs raise Bitcoin mining costs, impacting operational efficiency.
- Bitcoin faces slower hash rate growth amid geopolitical tensions and higher tariffs.
- Market sentiment turns bearish with rising short positions and extreme fear signals.
Bitcoin’s recent 28% correction has coincided with rising geopolitical tensions and increased uncertainty across global markets. A new wave of U.S.-China trade measures, including a 104% tariff imposed by the Trump administration on Chinese imports, directly affects the Bitcoin mining industry. The price pressure reflects both market fears and the possibility of operational setbacks facing mining companies that rely on Chinese-manufactured equipment.
Mining firms are now facing steep logistical and financial hurdles. According to Blockspace Media, major mining equipment producers such as Bitmain, MicroBT, and Canaan, most of which operate in Asia, are seeing their U.S. exports hit with new tariffs ranging between 24% and 104%, depending on the country of origin.
An increase in early equipment acquisitions resulted in exceptional delivery expenses and demand surges. Large air shipping costs have skyrocketed to $2 million and $3.5 million which stands at around four times more than typical shipping rates.
Miners attempting to avoid the steepest tariff rates had until April 5 to complete shipments tax-free. A 10% tariff applies to shipments finalized between April 5 and 9. After April 9, new rates will apply based on manufacturer location. Bitmain and MicroBT, which dominate the global market with a combined share exceeding 90%, are now assembling equipment in the U.S., though current domestic capacity remains limited.
Industry Impact Comparable to China’s 2021 Ban
Some market participants are comparing the current situation to China’s mining ban in 2021, which caused a 53% drop in Bitcoin’s price. Ethan Vera, COO of Luxor, stated that the newly imposed duties could disrupt U.S.-based mining operations. Vera added that if duties remain in place, competitive disadvantages will emerge, especially as mining firms in other regions face lower equipment costs.
Bitcoin’s network hash rate could also see slower growth, which could affect mining difficulty and operational efficiency. China imposed an 84% import tariff against all U.S. goods starting from April 10 as a counteraction to U.S. trade policies which further deepened international economic insecurities.
Short-Term Sentiment Shifts to Caution
Bitcoin is trading at around $80,000, which some analysts see as potential support during ongoing consolidation. Despite reaching an all-time high of $106,700 in 2025, the cryptocurrency is experiencing increased volatility. According to QCP Capital, Ethereum is underperforming and nearing $1,400, levels not seen since early 2023.
CryptoQuant data shows that short positions make up 55% of open interest, indicating a tilt toward bearish sentiment. According to recent reports, traders are moving toward defensive market strategies while building their liquidity pools due to growing macro-level threats. Current digital asset market sentiment shows “extreme fear,” according to the crypto fear and greed index.
