US Crypto Miners Rely on Foreign Suppliers, Especially from China
KUALA LUMPUR — Bitcoin mining companies in Southeast Asia encountered an urgent deadline recently: midnight on April 9. Christopher Berschel, president of Sealion Cargo, a Canadian freight forwarding firm, recalled, “That moment is going to be firmly etched in my memory for the rest of my life.” This urgency arose following U.S. President Donald Trump’s announcement of a harsh new tariff structure, imposing duties of 36%, 32%, and 24% on Thailand, Indonesia, and Malaysia, respectively. These nations have emerged as key centers for the assembly and distribution of crypto mining hardware. U.S. purchasers of these mining rigs faced significant financial repercussions unless Berschel and his team could expedite shipments before the impending deadline. In a race against time, Sealion orchestrated the chartering of five aircraft and managed numerous trucks and barges to transport $330 million worth of equipment from the three Southeast Asian countries to the United States. “With potential tariffs exceeding $80 million at stake, every flight, truck, and pallet we handled was focused on one goal: to beat the tariff deadline,” Berschel stated.
On April 9, however, Trump announced a 90-day suspension on the increased tariffs set to affect multiple trading partners, rendering the frantic efforts somewhat moot and financially burdensome. Mining companies incurred costs up to four times more than usual for air freight and potentially twenty times the typical expenses for ocean shipping, as reported by an anonymous source familiar with the situation. This episode highlights the complexities and high costs American businesses face when trying to adjust their global supply chains to mitigate the impacts of fluctuating trade policies under Trump’s administration. The threats posed by tariffs are particularly disruptive for crypto mining because there are few domestically manufactured machines capable of the high-performance computing necessary to thrive in this competitive field. This situation starkly contrasts with the president’s campaign promise to support American mining firms to ensure Bitcoin is “made in the USA.”
Crypto miners predominantly depend on suppliers from China, such as Bitmain Technologies Limited, which, despite being based in Beijing, distributes a significant amount of machinery through Southeast Asia. U.S. buyers have already experienced delays in receiving new mining equipment since Trump’s election, as scrutiny of Bitmain has increased. Taras Kulyk, CEO of mining hardware supplier and consultant Synteq Digital, noted a surge in inquiries regarding sourcing capacity outside the United States over the past couple of weeks. He expressed that tariff exemptions would be “extremely helpful” for their hardware and infrastructure. However, the duration of these exemptions remains uncertain. Recently, the U.S. announced exclusions for a range of electronics from 145% tariffs imposed on China and a 10% flat rate on global imports. Nevertheless, Trump later minimized these exemptions as merely procedural, indicating that tariffs would still apply to various electronics, including phones and computers, with decisions forthcoming.
Despite the looming 24% duty on Malaysian imports, U.S.-listed Bitfufu Incorporated is expected to maintain profitability, according to its chairman and CEO Leo Lu. “Nonetheless, we hope for avenues to alleviate the tariff burden, stimulate the industry, and attract more investment into the U.S. mining sector,” Lu added.
Global Ramifications of the Tariff Deadline
The urgency triggered by Trump’s tariffs extended beyond Asia. Vishnu Mackenchery, director of global logistics and services at Compass Mining Inc, rushed 3,000 units across the Canadian border following the April 2 announcement, all while determining the origins of various components from China, Thailand, and other locations. “Navigating business decisions in this volatile climate is challenging due to the constantly changing tariff landscape,” Mackenchery remarked. “It’s not just changing daily — it’s shifting hourly.”
Southeast Asia was at the center of this turbulent situation, where the urgency to act was palpable. Bitmain operates a factory under the name PT Aohai Technology Indonesia on Batam Island, part of a free trade area, where it assembles and ships its products, according to two sources familiar with the operations. Bitmain did not respond to requests for comment. EES Freight Services arranged, with only a day’s notice, for a barge filled with mining equipment to depart from Indonesia to Singapore. There, the cargo was loaded onto planes bound for the U.S., as described by Heru Winata, the firm’s operations director. EES also organized a flight to transport machines from Batam to Kuala Lumpur but faced delays due to the lack of forklifts at the airport, which hindered loading the aircraft.
Lauren Lin, head of hardware at Luxor Technology, reported that the firm successfully transported around 3,000 units — both its own and those of partners — from Thailand to the U.S. since the April 2 announcement. Worawut Pakdeesattayaphong, managing director of World Air Logistics, coordinated 57 truck trips to and from a warehouse near Bangkok to fill three chartered planes with crypto mining rigs. Two planes departed on April 7, while the third, following what Pakdeesattayaphong described as “non-stop operations” throughout the night, took off on April 8, just as everyone believed they were racing against the clock.
