Large mining equipment companies such as Bitmain, Canaan, and Ebang can suffer heavy losses due to new sanctions. According to the South China Morning Post (SCMP), the US government has tightened the rules for importing Chinese goods into the country.
Referring to a group of analysts, SCMP reported that the reforms introduced could have a significant impact on large Chinese companies engaged in the production of mining equipment. This is due to the fact that the office of the United States Trade Representative (USTR) has reclassified this category of goods, transferring it to a more stringent tariff regime.
Reportedly, earlier this year, the Trump administration increased import tariffs for more than 250 Chinese goods. The USTR reclassified Antminer S9 Bitmain, defining it as an “electrical appliance”, setting a tariff of 2.6%. Later, additional tariffs were introduced. The import duty on Chinese goods was increased to 25%.
It is worth noting that the two new tariffs give a total tax of 27.6% on the import of equipment for mining, while previously this fee was absent as such. Co-founder of Minco Bitcoin (BTC) LuTech, Ben Gagnon said:
“All manufacturers of mining rigs based in China will likely be affected by the tariff code change and, in turn, captured by the US trade tariff.”
According to SCMP, Canaan and Ebang revenues from international trade were 8.5% and 3.8%, respectively.
According to the data, the largest losses from the tariffs introduced may be incurred by Bitmain. As the data show, the company’s sales abroad amount to 51.8% of the total revenues. Experts reported that 94% of the company’s revenue is provided by the sale of mining equipment.
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