tl;dr
The Bitcoin mining industry is experiencing a surge in hashrate, reaching a record high of 850 million TH/s in March 2025. This growth, however, is accompanied by escalating production costs and trade barriers, particularly in the US, posing significant challenges for mining companies. Despite the i...
The Bitcoin mining industry is experiencing a surge in hashrate, reaching a record high of 850 million TH/s in March 2025. This growth, however, is accompanied by escalating production costs and trade barriers, particularly in the US, posing significant challenges for mining companies. Despite the increased hashrate, mining profits are not proportionally rising, with the cost of mining one Bitcoin doubling since early 2024, now at $87,000. Rising electricity prices and operational costs are cited as key drivers behind this increase.
Another major obstacle for Bitcoin miners is trade restrictions, particularly in the US. ASIC miners produced by Bitmain, a Chinese company, account for approximately 59%–76% of Bitcoin’s total hashrate. However, in early 2025, some US mining companies experienced delays in receiving Bitmain shipments due to tighter customs controls and new tariffs on Chinese imports. These tariffs are inflating operational expenses for US-based miners and disrupting supply chains, limiting their ability to scale as global hashrate rises.
Recently, Hut 8 Corp., a Bitcoin mining and high-performance computing infrastructure firm, partnered with Eric Trump and Donald Trump Jr. to establish American Bitcoin Corp. The company aims to become the largest and most efficient pure-play Bitcoin mining operation globally while building a strong strategic Bitcoin reserve. This move highlights the increasing interest from US institutional investors in the competitive mining industry.
Bitcoin’s hashrate measures the total computing power used by miners to secure the network and validate transactions. It is expressed in terahashes per second (TH/s), reflecting the number of hash calculations the network performs every second. According to Blockchain.com, Bitcoin’s hashrate surpassed 850 million TH/s in March, reflecting a rise in miners joining the network and growing confidence in Bitcoin’s value and security.
Despite this surge in hashrate, mining profits are not rising accordingly. According to a report from Macromicro, the cost of mining one Bitcoin has doubled since early 2024, now reaching $87,000. The main drivers behind this increase are rising electricity prices and the high operational costs of specialized mining hardware (ASICs).
With Bitcoin’s price fluctuating, many mining companies risk operating at a loss unless they optimize their efficiency. This challenge is particularly severe for smaller miners, who lack the scale advantages or access to cheap electricity that larger firms enjoy.
The industry is also witnessing increased interest from US institutional investors, as seen in the establishment of American Bitcoin Corp by Hut 8 Corp., signaling the growing competitiveness in the sector.
According to CoinMetrics, the US has imposed duties of up to 27.6% on imported mining equipment from China since 2018. However, recent measures indicate increasing regulatory scrutiny and trade pressures, further raising import costs for mining hardware. This inflates operational expenses for US-based miners and disrupts supply chains, limiting their ability to scale as global hashrate rises.
These tariffs are not new. With Bitmain accounting for a majority of Bitcoin’s network hashrate, reliance on a single manufacturer, despite having distributed supply chains, presents a potential risk. Since Bitmain is primarily based in China, its dominance highlights how geopolitical dependencies can affect the stability of mining operations.
These challenges are reshaping the landscape for Bitcoin miners, requiring them to navigate escalating costs and supply chain disruptions while also seeking ways to optimize their operations in a competitive industry.