Mining stocks plunge on Trump's new import tariffs

Donald Trump was long viewed as the favorite of American Bitcoin miners.

Donald Trump was long viewed as the favorite of American Bitcoin miners. During his campaign, he pledged to push hard for ‘energy dominance’ and voiced his support for the mining industry.

But now his new trade war is delivering a big hit to the stock prices of major mining companies. Marathon (MARA) saw its stock drop 11.23% in a day, Riot fell 9%, and Core Scientific took a 15% hit.

The combined market value of the big, publicly traded Bitcoin miners is now only about $20.3 billion. The four largest mining companies in the world are all based in the United States.

The big problem: Trump wants a 10% baseline import tax on every product entering the U.S., and an eye-popping 34% tariff on goods from China. And the majority of mining gear comes from China.

“These import tariffs will definitely affect mining companies that rely heavily on Chinese ASIC manufacturers for their future growth,” warns Bitcoin mining expert Wolfie Zhao in conversation with Decrypt.

One of the biggest mining-hardware manufacturers, Bitmain, is based in Beijing and has production facilities in Indonesia, Malaysia, and Thailand. The U.S. now imposes a 36% import tax on Thai-made products.

This sudden hike in import duties could raise costs across the sector. That would in turn impact the global hash rate of the Bitcoin network and put mining profitability in the U.S. under serious pressure.

Ironically, Trump said at the Bitcoin Conference: “We want all remaining BTC mined in the U.S.” But with his new protectionist trade policy, he could end up doing lasting damage to the American mining industry.