The Trump administration’s sweeping tariffs could collapse US demand for Bitcoin mining rigs, which would benefit mining operations outside the country as manufacturers will look outside the US to sell their surplus inventory for cheaper, says Hashlabs Mining CEO Jaran Mellerud.

“As machine prices rise in the U.S., they could paradoxically decrease in the rest of the world,” Mellerud said in an April 8 report. “The demand for shipping machines to the U.S. is set to plummet, likely nearing zero.”

“Manufacturers will be left with excess stock originally intended for the US market. To offload this surplus, they’ll likely need to lower prices to attract buyers in other regions,” he added.

Falling mining rig prices could see non-US mining operations scale up and take a larger slice of Bitcoin’s total hashrate, Mellerud said.

Source: Jaran Mellerud

US President Donald Trump unveiled his administration’s “reciprocal tariffs” on nearly every country on April 2. Some of the largest crypto mining machine makers are based in countries hardest hit by the tariffs, including Thailand, Indonesia and Malaysia, which saw tariffs of 36%, 32% and 24%, respectively.

Crypto mining rig makers Bitmain, MicroBT and Canaan moved to some of these countries to circumvent a 25% tariff that Trump imposed on China in 2018 during his last administration.

Annual change in US tariffs on China, Indonesia, Malaysia and Thailand since 2017. Source: Hashlabs Mining

Mellerud noted that Trump’s latest tariffs would mean a mining rig that initially costs $1,000 would be priced at $1,240 in the US.

“Meanwhile, in Finland and most other countries, there are no tariffs, so the cost of a $1,000 machine remains unchanged.”

“In an industry as cost-sensitive as Bitcoin mining, a 22% price increase on machines can make operations financially unsustainable,” he added.

No coming back from Trump’s tariffs — ‘Damage is done’

Mellerud believes a future reversal of the Trump administration’s tariffs wouldn’t restore US crypto mining operators’ confidence.

“Even if these tariffs are rolled back within a few months, the damage is done — confidence in long-term planning has been shaken,” Mellerud said. “Few will feel comfortable making major investments when critical variables can change overnight.”

He said US miners felt reassured when Trump returned to the White House, expecting a more stable regulatory environment. 

Related: Bitcoin hashrate tops 1 Zetahash in historic first, trackers show

“But they are now experiencing the flip side of his unpredictable policy shifts,” Mellerud said.

The US accounts for nearly 40% of the network’s hashrate. Mellerud said there’s no reason for US miners to unplug their machines and doesn’t expect the total Bitcoin hashrate coming from the US to drop.

However, the path to expansion is now “steep and uncertain,” he said, and as a result, the US could lose a considerable share of hashrate. 

Trump’s tariffs have shaken up almost every market, including the crypto markets and Bitcoin (BTC), which is down 4% over the last 24 hours to $76,470, CoinGecko data shows.

Bitcoin is now 30% off the $108,786 all-time high it set on Jan. 20 — the same day that Trump re-entered the White House.

Magazine: Crypto fans are obsessed with longevity and biohacking: Here’s why

Crypto and equities traders were hopeful for a last-minute solution that would prevent the US from enacting 104% tariffs on Chinese goods entering the United States, but in a press conference, the White House confirmed that the tariffs would start on April 9. Markets deteriorated when Peter Navarro, trade adviser to US President Donald Trump, stated that tariffs were “not a negotiation.”

As a result, the S&P 500 index closed on April 8 with a 1.6% loss, reversing earlier gains of 4%. This downturn has left traders wondering whether Bitcoin (BTC) can regain its bullish momentum amid worsening macroeconomic conditions.

Spiraling US debt issues remain, paving the way for Bitcoin gains

Between April 2 and April 7, the S&P 500 index dropped by 14.7%, causing panic among Bitcoin holders and forcing a retest of the $75,000 level—the lowest in more than five months.

S&P 500 futures (left) vs. Bitcoin/USD (right). Source: TradingView / Cointelegraph

During an appearance with Israeli Prime Minister Benjamin Netanyahu on April 7, President Trump reportedly said his goal was to “reset the table” on trade. He added that “there can be permanent tariffs, and there could also be negotiations because there are things that we need beyond tariffs.” Amid this uncertainty, IPOs and mergers have been delayed, while leveraged loan deals and bond sales were sidelined, according to Yahoo Finance.

It becomes clear that the stock market is likely to rally if trade war risks subside. Economists have cautioned that tariffs could trigger inflation and significantly raise the chances of an economic recession, according to Reuters. However, assessing the impact on Bitcoin’s price remains a challenging task. This is because some investors see the cryptocurrency’s fixed monetary system as a safeguard against the continuous expansion of global fiat currency supplies.

Short-term correlations hurt BTC, but possible interest rate cuts could turn the tide

In the short term, the positive correlation between Bitcoin and the stock market is expected to persist. Nonetheless, the US government’s fiscal challenges present a potential opportunity for Bitcoin’s price to grow. On April 8, the US 10-year Treasury yield rose to 4.28%, following a brief dip to 3.90% on April 7. This increase suggests that investors are demanding higher returns to hold these assets.

US Dollar Index (DXY, left) vs. US 10-year Treasury yield (right). Source: TradingView / Cointelegraph

The rising cost of rolling over the $9 trillion in federal government debt set to mature within the next 12 months is expected to increase fiscal imbalance and weaken the US dollar. The US Dollar Index (DXY) has diverged from US Treasury yields, falling to 103.0 on April 8 from 104.2 on March 31. This situation could potentially support Bitcoin’s price—a sentiment shared by BlackRock CEO Larry Fink in his March 31 letter to investors.

Related: Weaker yuan is ‘bullish for BTC’ as Chinese capital flocks to crypto — Bybit CEO

Michael Gapen, Morgan Stanley’s chief US economist, stated in a client note on April 8: “We think the right answer is for the Fed to wait in its current stance for longer,” as reported by CNBC. According to Morgan Stanley’s updated forecast, the US Federal Reserve is expected to maintain interest rates at 4.25%-4.50% until March 2026, adding that “only a recession would change the calculus” and “a recession could mean earlier and larger up-front cuts.”

Bitcoin’s momentum is likely to turn positive as traders realize that the US Federal Reserve has limited tools to avoid a recession without risking inflation. While predicting the exact timing of a breakout remains uncertain, prolonged delays in resolving trade war issues could drive investors toward scarce assets like Bitcoin, especially amid fears of potential US dollar devaluation.

This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

RedStone, a blockchain oracle provider, has introduced a push-based oracle on MegaETH to tackle latency issues that challenge the efficiency of onchain trading.

According to a spokesperson for RedStone, the new oracle can push new prices onchain every 2.4 milliseconds. Initially debuting on MegaETH, an Ethereum layer-2 network, the product may be rolled out to additional chains in the future.

RedStone said its oracle sources prices from centralized exchanges and delivers them directly to applications or smart contracts via nodes that operate natively on the MegaETH chain.

This “co-location” strategy minimizes latency by eliminating delays typically caused by the physical distance between servers. In the future, RedStone also plans to include price feeds from decentralized exchanges.

Oracles compatible with the Ethereum Virtual Machine (EVM) are becoming more popular. According to Alchemy, there are currently 12 decentralized oracle networks operating on Ethereum.

Oracles can make money through data usage fees, licenses, staking rewards and node incentives. The current market capitalization for oracle tokens sits at $10.2 billion, according to CoinMarketCap.

Related: Trump’s World Liberty Financial taps Chainlink as oracle provider

DeFi growth spurs further rise of oracles

Decentralized finance’s total value locked onchain nears $88 billion as of April 8, after rising 116% in 2024, according to DefiLlama. Ethereum remains the top blockchain for DeFi applications, with $47.8 billion locked in the network, followed by Solana with $6.1 billion in DeFi TVL.

DeFi TVL over time. Source: DefiLlama

The rise of DeFi has intensified competition in the oracle market — an essential component for the functioning of decentralized applications. Price oracles feed real-time market data into smart contracts, acting as a bridge between blockchains and the real world.

Popular players in the oracle space include Chainlink and Pyth Network. In October 2024, Pyth flipped Chainlink in 30-day volume, reaching $36 billion in transactions. The protocol offers a pull-based model that provides data upon request, thus making it optimized for high-volume activities.

Magazine: Financial nihilism in crypto is over — It’s time to dream big again