Historically, tariffs — originally known as “market taxes” — were levied on goods passing through trade routes such as the Silk Road. As a macroeconomic tool, tariffs directly influence market pricing and supply chain efficiency. For the crypto industry, the consequences extend beyond the immediate rise in costs for mining rigs and tech components; they also disrupt supply chain liquidity, market structure, and the overall efficiency of the sector.
Bitcoin remains the most dominant digital asset, shaping the broader crypto market. As of April 2, 2025, Bitcoin accounts for 59% of the total crypto market capitalization, according to CoinMarketCap. Given Bitcoin’s reliance on the Proof-of-Work (PoW) consensus mechanism, mining hardware supply chains play a critical role in the industry’s trajectory. While the U.S. mining sector has increased its share of global hash power from 37.64% to 45.15%, mining hardware production is still largely dominated by Chinese manufacturers such as Bitmain, MicroBT, and Canaan, which together control over 70% of the global market. This presents a significant challenge to the Trump administration’s goal of “bringing Bitcoin mining back to America.”
The U.S. government’s 20% tariff hike on Chinese electronics exacerbates supply chain disruptions. If applied to mining equipment, the cost of rigs is projected to rise by approximately 17%, impacting the return on investment (ROI) for mining farms. For new entrants, this will be a crucial factor in determining profitability. Some manufacturers, such as MicroBT and Bitmain, have responded by establishing production facilities in Malaysia and the U.S. to mitigate risks. However, these relocations have introduced delivery delays, with customers now waiting between one to three months for shipments — posing serious challenges for mining operations that rely on timely hardware replacements.
Beyond tariffs, the global semiconductor shortage and U.S. export restrictions on Chinese technology have forced mining rig manufacturers to diversify production locations, increasing the risk of supply bottlenecks. Over the short term, this could slow down the expansion of mining farms and consolidate market power in favor of large-scale players with greater capital reserves. Smaller mining operations, facing prolonged ROI cycles, may be forced to exit the market.
Ultimately, the combined impact of tariffs, supply chain disruptions, and rising hardware costs is pushing the Bitcoin mining industry toward greater centralization. Large-scale enterprises are likely to gain an outsized share of the market, while smaller players struggle to remain competitive. Meanwhile, other blockchain projects that rely on non-U.S. electronic hardware — such as AI-driven blockchain applications — are also facing similar cost pressures.
The impact of U.S. trade policies extends beyond rising product costs — it is actively reshaping the global financial order. Over the past few years, the rapid growth of USD-backed stablecoins has emerged as a key pillar of U.S. financial strategy — tightening control over traditional financial channels while expanding dollar liquidity in the digital realm.
Historically, global trade settlement has depended on banking networks, with clearing systems like SWIFT and CHIPS dominating international capital flows. However, in response to geopolitical tensions, the U.S. has coupled tariff hikes with financial restrictions, including data decoupling measures and increased regulatory scrutiny over cross-border transactions. A key example is Executive Order 14117, signed by President Biden in 2024, which restricts U.S. data access for “countries of concern.” Set to take effect on April 8, this order has forced major fintech firms, including PayPal, to restructure their operations in China. While officially targeting cloud computing and the semiconductor industry, the policy has broader implications — severing supply chain data-sharing between multinational firms and disrupting trade finance and payment settlements.
Against this backdrop, stablecoins have emerged as a new liquidity channel for global commerce. As regulatory barriers mount in the traditional banking sector, USDC and USDT are increasingly being used for supply chain payments — from financial firms in Argentina to exporters in Southeast Asia and traders in the Middle East. Stablecoins offer low-cost, instant settlements, making them an attractive alternative to conventional banking. For example, while SWIFT transfers can take 2–5 days with fees averaging $20-$40, a USDC transaction costs less than a cent and settles within seconds.
In capital-restricted economies like Argentina and Nigeria, demand for stablecoins has surged. In 2024, Argentine buyers paid a 30% premium for stablecoins, while Nigerian buyers faced a 22% markup. These premiums reflect the growing reliance on stablecoins to bypass banking restrictions and hedge against currency depreciation.
As tariffs reshape global trade, demand for USD stablecoins is set to rise — fueling the expansion of an alternative “shadow dollar” market that operates outside the Federal Reserve’s control.
Unlike traditional bank deposits, stablecoins are backed by U.S. Treasuries rather than bank reserves. This means that while their issuance is indirectly influenced by Fed policy — since T-bill yields affect stablecoin supply — their liquidity is not directly regulated by the Fed. When global demand for dollars surges, stablecoin issuers can rapidly mint new tokens without Fed approval. As a result, even if the Fed pursues monetary tightening, the stablecoin market can effectively counteract liquidity constraints, expanding global dollar supply through decentralized networks.
Moreover, stablecoin liquidity is increasingly circulating within crypto-native financial ecosystems — including DeFi platforms, centralized exchanges (CEXs), and on-chain payment networks. Unlike traditional banking deposits, these funds do not flow back into the Fed-regulated financial system. Some DeFi platforms even offer higher yields on stablecoin deposits compared to commercial banks, further weakening the Fed’s ability to control interest rates.
Meanwhile, the surge in stablecoin demand has boosted demand for U.S. Treasuries, indirectly suppressing bond yields. As Real-World Assets (RWA) tokenization gains traction, stablecoin liquidity is increasingly penetrating traditional capital markets, complicating the Fed’s monetary policy transmission.
