Bitcoin News Today: Prioritizing AI Chips Risks U.S. Bitcoin Supremacy, Critics Warn

The U.S. Senate's passage of the GAIN Act amendment to the National Defense Authorization Act (NDAA) has ignited concerns over its potential to disrupt the crypto mining industry by restricting access to advanced AI and high-performance computing (HPC) chips . The legislation, which mandates that chipmakers prioritize U.S. orders before exporting advanced processors, could exacerbate supply chain bottlenecks and elevate hardware costs for Bitcoin miners, further squeezing profit margins already strained by tariffs and geopolitical tensions .

GAIN Act's Provisions and Industry Pushback

The GAIN Act requires manufacturers to secure U.S. demand fulfillment before obtaining export licenses for advanced integrated circuits, with Congress retaining the authority to deny licenses for the most powerful AI chips . This "domestic first" policy aims to bolster national security and U.S. technological leadership but has drawn criticism from industry players like Nvidia, which argues the restrictions are unnecessary and could stifle global competition . Nvidia contends that it already prioritizes American customers, noting that U.S. sales accounted for nearly half of its 2024 revenue, and warns that the legislation could undermine the U.S.'s ambition to lead in AI innovation .

U.S. Hashrate Dominance and Vulnerabilities

The U.S. currently controls over 40% of the Bitcoin network's hashrate, driven by mining pools like Foundry USA and MARA Pool, which collectively mined 38.5% of blocks in 2024 . However, this dominance faces challenges from China-based pools, which still command 55% of the global hashrate through tactics like VPNs to circumvent the 2021 crypto ban . The concentration of hashrate in a few pools has already sparked debates over decentralization, with critics like Auradine CEO Rajiv Khemani framing it as a national security issue .

Compounding Pressures on Miners

The GAIN Act's proposed export curbs would compound existing struggles for U.S. miners. Tariffs and trade disputes have already imposed significant financial burdens: CleanSpark faces $185 million in customs liabilities, while IREN reported $100 million in duty exposure due to hardware origin disputes . These costs, coupled with rising energy prices and post-halving profitability declines, threaten to erode the U.S.'s competitive edge in mining . The Hashrate Index shows that U.S. miners already trail regions like the Middle East, where electricity costs as low as $0.035/kWh enable more cost-efficient operations .

Mitigation Strategies and Uncertain Outlook

Miners are urged to adopt proactive measures, including securing early chip purchases, diversifying suppliers, and exploring secondary markets for used rigs . However, the GAIN Act's final form remains uncertain, as it still requires House approval and presidential signature. Industry observers note that supply constraints for cutting-edge chips-such as Nvidia's Blackwell GPUs, which are booked 12 months in advance-could delay exports even if the legislation passes .

The interplay of regulatory shifts, trade policies, and technological competition will shape the future of Bitcoin mining. While the U.S. aims to solidify its position as a crypto hub, miners must navigate an increasingly complex landscape where hardware access, energy costs, and geopolitical dynamics determine survival.

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Source: [1] Bitcoin Mining Tax Strategy: Maximize 2025 Deductions (https://www.thenetworkfirm.com/blog/bitcoin-mining-tax-strategy-maximize-2025-deductions)

[2] Tax on Mined Bitcoin: Is it Income or Capital Gain? - Sazmining (https://www.sazmining.com/blog/taxation-mined-btc)

[3] Bitcoin mining 2025: Post-halving profitability (https://cointelegraph.com/news/bitcoin-mining-2025-post-halving-profitability-hashrate-and-energy-trends)

[4] US accounts for over 40% of global Bitcoin hashrate: ... (https://cointelegraph.com/news/us-accounts-over-40-percent-bitcoin-hashrate-2024)

[5] GAIN Act Amendment Could Tighten AI Chip Exports and Hurt ... (https://en.coinotag.com/gain-act-amendment-could-tighten-ai-chip-exports-and-hurt-bitcoin-mining-competitiveness-in-the-u-s/)

[6] US Dominates Bitcoin Hashrate with Over 40% Control (https://news.bitcoinprotocol.org/us-dominates-bitcoin-hashrate-with-over-40-control/)

[7] US Dominates Bitcoin Mining with Over 40% of Global ... (https://cryptonews.com/news/us-dominates-bitcoin-mining-with-over-40-of-global-hashrate-at-end-of-2024/)

[8] US Senate passes GAIN Act, prioritizing domestic AI and HPC chip ... (https://cointelegraph.com/news/senate-passes-gain-act-prioritizing-domestic-hpc-ai-sales)

[9] What is the GAIN AI Act and Why Does Nvidia Oppose it? (https://aimagazine.com/news/what-is-the-gain-ai-act-and-why-does-nvidia-oppose-it)