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I believe this was posted yesterday... but in my opinion it didn't get enough attention.
Perhaps the best way (or only way) in which tariffs are good for Bitcoin is the making of Chinese-made mining equipment and supplies much more expensive to bring to the United States.
It doesn't raise the cost of Chinese-produced mining equipment per se... but it becomes vastly more expensive to import into the United States because of the tariffs, giving mining locations and facilities OUTSIDE OF the United States an ENORMOUS advantage.
  • This means less control over hashrate by the US government, less influence over hashrate (and therefore transactions) by the US government or regulators and the probable "scattering" of hashrate to outside of the United States.
For example, a 10,000 Dollar purchase of mining equipment from China (ASICS mostly made in China) now costs 56% more so... 15600$.
100,000 Dollars of equipment, small for a large facility, is now 156000 to acquire the same exact equipment and import to the United States.
To maintain, upgrade, and operate a facility like this... how much more would it cost?

Combined with the historically-low hashprice (the reward, per hash paid in Fiat for mining) makes this the most competitive mining environment ever especially in the United States.
Hashrate is currently at all time highs
Block times are absolutely screaming with a ~5% increase in difficulty (blocks are "getting faster'")
and fees are near multi-year lows.
Hence the hashprice is ultra-low
According to the article:
Csepcsar also noted that cutting-edge chips for crypto mining are currently massively produced in countries like Taiwan and South Korea, which were hit by new 32% and 25% tariffs, respectively. “It will take a decade for the US to catch up with cutting-edge chip manufacturing. So again, companies, including American ones, lose in the short term,” he said.
Csepcsar also observed that some countries in the Commonwealth of Independent States region, including Russia and Kazakhstan, have been beefing up mining efforts and could potentially overtake the US in hashrate dominance. “If we continue to see trade war, these regions with low tariffs and more favorable mining conditions can see a major boom,” Csepcsar warned.
As the newly announced tariffs potentially hurt Bitcoin mining both globally and in the US, it may become more difficult for Trump to keep his promise of making the US the global mining leader.

And that's key: we don't want the US to be the "global mining leader" - we want to reduce Foundry's scope, reach and outrageous hashrate concentration.
Having so much hash centralized to the US... vulnerable to regulators and government is extremely dangerous and successive blocks by Foundry are likely the "greatest threat" posed to Bitcoin's security and trust-model.
9 blocks in a row is fucking outrageous and our whole "community" should be clear this is not acceptable.

Like with so many things in the Trump administration... the irony is palpable. Trump wanted the Bitcoin "made in America".
The tariffs on China will do exactly the opposite and hopefully make mining far, far less profitable in US-vulnerable jurisdictions.
I'm not "a fan" of Russia or Kazakhstan's Human Rights records... but as far as possible from the US is A MUCH BETTER place for Bitcoin mining and ultimately Bitcoin's censorship resistance.
And if the tariffs help get mining OUT of the United States... it will do Bitcoin an enormous favor and for that we can be, ironically, thankful for Mr Trump's economics.
this territory is moderated
302 sats \ 5 replies \ @OT 12h
There are surely miners that mine in other countries but point their hash to Foundry? Also there are other miners in the US who point their hash at other pools.
Also, like during COVID states in the US started flexing their own autonomy. A blanket ban after Trump or too much hash in the US isn't our biggest issue at the moment IMO.
I mean I kinda agree with having other jurisdictions crowning their hash rate, but it comes down to the cheapest energy right? China will have to fire up again, then there's Africa and the middle East growing too.
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It's not 'a ban' on mining... It's kinda the opposite imo. Having too much hash concentrated in Foundry, to the point of mining 9 blocks in a row is not supposed to happen it's not OK.
What if people waited 6 blocks for final settlement, and foundry decided to 'double-spend' reversing all those transactions? Foundry is essentially deciding on 'one' template for the transactions... for all that hashrate.
It's not great long term.
The reason miners join foundry FPPS is to get consistent rewards paid out regardless of blocks found... but the result is potential regulatory capture, and with a pool that big anyway there's no reason for FPPS.
'Big pools' in third countries with really cheap energy is the way to go. And if US manufacturers are more incentivized to make their own chips great... but they'll have to be made in the US or get the tariff.
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5 sats \ 3 replies \ @OT 11h
I don't like that Foundry have so much hash. Finding 9 in a row is just luck. If Foundry did double spend after 6 blocks and the sender of the TX spread that info through social media I think they would lose a lot of their hash rate.
The incentive is still to play along. Maybe that's a bit naïve but they're a big business now with a lot to lose. It's trivial to switch pools.
Bitmain on the other hand are well known bad actors, but there's not much we can do about it until there's more competition in mining hardware.
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21 sats \ 1 reply \ @OT 11h
I agree that this isn't good. But these links are about the Bitmain/Antpool proxies. Your post is focused on Foundry who do construct their own blocks.
Best we can do is keep educating these fiat miners and hope it gets through that overall it's bad for Bitcoin and the price will go down if it continues.
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According to "Bitcoin Mechanic" (I'm just going of of Twitter) it's not in their interest to avoid regulatory capture. It's 'cheaper' to just stay in Foundry to avoid the regulatory scrutiny rather than risk mining,,, 'forbidden' transactions that require lawyer intervention/additional costs.
Therefore the only thing they care about is the 'bottom line' which the tariffs which will impact.
That plus the 9 blocks in a row is unacceptable.
I rather Bitcoin/Antpool be huge than have everything concentrated in the US. The US government will have an interest in mining eventually regardless... and it's important 'unfriendly nations' have mining/blockspace access to keep the thing trustless.
Seems like a mid-curve article, the system is too dynamic to consider all the variables
  • US has nearly unlimited waste energy from its fossil fuel production and now has far less fucks to give about global energy production
  • ASICs are not "cutting-edge" chips, if anything tariffs just make it more likely a local fab starts cranking them out because they can't yet make high-end GPUs
  • Mined Bitcoin becomes a more likely US export in a world where less dollars are available for export and a neutral reserve currency is needed in FX
  • On-shoring of other manufacturing creates more demand for elasticity in the power grid
Whats observable in the first order means little because nobody can possibly account for all the systemic variables, the markets "invisible hand". If anything it's counter-intuitive that America winning comes with the asterisk of losing hash rate
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interesting thoughts.
asics not cutting edge... but the largest manufacturer is bitmain. it is a centralization of mining hardware (not energy) and it's expensive and slow to develop new competing chips.
block is making one, maybe one other US company and also a few oversea firms but it will take time. bitmain makes the rest and we need an honest conversation about this.
if bitcoin becomes the neutral reserve currency for fx we are going to the ******* moon
i agree with that about the power grid and yes elasticity is very interesting.
as far as the tariffs go... the logical conclusion is that they reduce US access to hash in the medium term. short term no asics already here... long term maybe not but medium absolutely. the us has less hash.
i want to see miners pointing at ocean or other small pools running off hydro or solar in africa and south america. that's the lightbulb moment...
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bitmain makes the rest
That's just one assumption, its also long been assumed that the massive increase in hash rate is due to some other chips being made that aren't publicly available.
Bitmain has no moat, if an American fab wants to start cranking out chips they can... and tariffs give them even more reason to than they had before.
The other variable not accounted for is the fab making Bitmain chips has to start making other chips because of China's lack of access to US chips
Agreed that pools and block templates are a concerning centralization vector, but I'm optimistic given all the solo blocks being found and things like Heatbit ramping up. I expect in ~5 years any appliance in your house that uses a heating element will have options for a version with a chip-based heating element.
Every houses hot water heater mining sats means every homeowner get to vote with hash rate which will make pools/templates more user-aligned and therefore decentralized.
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i hope you are right, all this stuff is really interesting. i'm not to the point of getting a mining hot-water heater... but i have a btc apollo i sit next to in the living room instead of running the heat. i would order another one but they are sold out i wonder why...
i really hope you are right about bitmain... that hw centralization i have heard over and over again and i have no reason to believe it's not true
the hash rate increases are really stunning
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Check out Heatbit... I know he's been marinading on other possible appliances. Very bullish on that operation.
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I dont know. I feel there isnt much incentive to mining in a country that suddenly doesnt like mining. They will just seize your operation. Still 100x more safe to mine in the USA.
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An incredibly important side effect!
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you literally just described the benefit of tariffs for every industry, not just bitcoin. congrats
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Funny how you assumed we cannot do percentages. On the topic, agree, the goal "to have all bitcoins produced in the USA" is undermined.
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i'm sorry i didn't mean it that way. i meant to demonstrate that while it's a percentage increase... it's nominally more for large capital expenses. 150% of a lot vs 150% a little...
the pictures of the riot facilities i thought would demonstrate that. if these huge, large facilities are all on foundry we can and should do better.
lots of people way smarter than me talking about this
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