Trump Pushes for US-Mined Bitcoin, but Industry Cites Power Costs as Primary Barrier

Former President Donald Trump, in a significant shift in tone, met with top executives from the U.S. Bitcoin mining industry in early June and declared his support for having all future Bitcoin mined in the United States. While the industry has welcomed the political overture, particularly in contrast to the current administration's proposals, experts and operators caution that political will alone cannot overcome the primary obstacles to domestic expansion: high energy costs and local infrastructure bottlenecks.

During the meeting, which included Senator Bill Hagerty (R-Tenn.), Trump reportedly framed U.S.-based Bitcoin mining as a strategic imperative for energy dominance and national security. This follows months of increasingly pro-crypto rhetoric from the former president, including accepting campaign donations in digital currencies and vowing to protect the right to self-custody assets. Participants told CNBC that Trump seemed genuinely interested in how miners could help solve the nation's energy deficit problems.

This stance marks a stark contrast to the Biden administration's approach. The U.S. Treasury Department under the current administration has proposed a 30% excise tax on the electricity costs for digital asset mining operations, a measure the industry views as punitive. For years, mining executives have expressed frustration over their inability to secure a similar audience with the current White House.

Adding to the shifting political landscape is a legislative effort in Congress, H.R. 9175, the Tax Clarity for Mining and Staking Act. The bipartisan bill would allow miners and stakers to defer paying taxes on newly created crypto assets until those assets are sold. Currently, the IRS treats block rewards as immediate income, creating a tax liability before any cash is realized. While this tax deferral would be a welcome relief for U.S. operators, many in the industry see it as a marginal improvement that does not address the fundamental economics of their business.

The core challenge for Trump's “made in America” vision is not the tax code, but the power grid. According to industry analyses, the single most important factor in deciding where to build a new mining facility is the cost and availability of electricity. Location decisions are driven by proximity to power substations, the ability to secure long-term utility contracts at competitive rates, and the speed of local permitting queues—factors that federal policy has limited influence over.

This has been demonstrated in communities across the country. In 2017, Bitcoin miners were drawn to Plattsburgh, New York, by its cheap hydroelectric power. However, as former mayor Colin Read noted, the new operations consumed so much energy that electricity rates for residents surged by as much as 40% in winter months. The subsequent local backlash led to new regulations and the departure of all but one mining company.

Similar resistance has emerged even in areas with strong political support for Trump. In Yates County, New York, where roughly 60% of voters backed Trump, the Greenidge Generation power plant's move into Bitcoin mining has faced significant local opposition over its environmental and community impact. This illustrates the deep-seated friction between large-scale industrial energy consumption and the interests of local communities.

Faced with these domestic hurdles, the Bitcoin mining industry has become increasingly global. Despite the U.S. currently accounting for about 40% of the world's Bitcoin production following a 2021 crackdown in China, new expansion is often directed overseas. Miners are actively developing new facilities in Paraguay, Finland, Laos, and nations in East Africa and the Persian Gulf, all in pursuit of cheaper power. This global diversification is a direct response to the economic realities that make U.S. operations less competitive, especially during market downturns. When the hashprice—a measure of mining profitability—fell to a record low, only operations with the newest hardware and genuine power cost advantages remained profitable, according to a report from CoinShares.

While a friendlier federal tax policy is a positive step, it doesn't alter the fundamental business calculus for capital-intensive projects like crypto mining. In our experience, the primary drivers of success or failure in this sector are operational and local, not federal. Energy costs, permitting delays, and local community relations represent the most significant financial risks. Companies considering investments in domestic mining should not base their strategy on political rhetoric alone. We advise clients to conduct rigorous due diligence on power contracts and local regulatory environments before committing capital. Navigating these complexities is where effective financial risk management proves its worth, ensuring that a project is viable on its own economic merits, independent of shifting political winds. For businesses evaluating such opportunities, C&S Finance Group LLC at csfinancegroup.com provides guidance on structuring these complex ventures.

The coming months will clarify whether this new political momentum can translate into tangible policy. The progress of the Tax Clarity for Mining and Staking Act through Congress and the outcome of the presidential election will be critical indicators. Ultimately, the success of any push to onshore Bitcoin mining will depend less on federal declarations and more on the ability to solve complex, local-level challenges of power generation and infrastructure development.