US Investigates Bitmain for Possible Security Risks in Bitcoin Mining Hardware

The United States is investigating Bitmain, the Chinese manufacturer known worldwide as the market leader in Bitcoin mining equipment. According to Bloomberg’s sources, US authorities fear that the company’s equipment could pose a risk to national security, including possible vulnerabilities that could be exploited for espionage or sabotage.

Research focuses on possible external control of equipment

The federal investigation, internally referred to as Operation Red Sunset, is being conducted by the U.S. Department of Homeland Security. It specifically targets Bitmain ASIC devices, which are used in the crypto mining sector. Researchers want to find out whether these devices can be controlled remotely. If that proves possible, it could give malicious parties access to infrastructure that is essential to the United States.

The investigation comes after previous concerns. In October 2024, Chinese chip company Xiamen Sophgo, which has ties to Bitmain, was investigated for possible connections to Huawei. Shortly afterwards, US Customs stopped the delivery of thousands of Bitmain machines. It wasn’t until months later that these devices were released in phases.

Heavy dependence on Chinese hardware

The impact of the research could be significant, as Bitmain controls more than 80 percent of the global Bitcoin mining hardware market. Together with the Chinese manufacturer MicroBT, the companies even control 97 percent of the market. This makes the American crypto mining sector particularly vulnerable to geopolitical tensions.

Because of this dependency, new restrictions or delays in deliveries could directly impact U.S. miners. Earlier this year, several listed mining companies faced delays due to trade conflicts between the US and China.

Bitmain denies all allegations

Bitmain said in a response to Bloomberg that the accusations are incorrect. The company says its devices cannot be controlled remotely and that it is fully compliant with all US laws and regulations. According to Bitmain, it has not been officially informed of the investigation.

Political dimension through ties with Donald Trump’s family

The issue takes on political significance because American Bitcoin, a mining company backed by relatives of President Donald Trump, is heavily dependent on Bitmain equipment. In August, the company acquired more than 16,000 machines from Bitmain. In addition, it acquired more than 31,000 Bitmain units through an acquisition of Hut 8.

SEC documents show that the company uses a remarkably favorable payment arrangement, something that raises questions among analysts.

Uncertainty for US crypto mining sector

The US investigation could have major consequences for crypto companies that rely heavily on Bitmain hardware for their daily operations. Possible import restrictions, additional checks or longer waiting times could put pressure on the sector again.

For now, both companies and investors are waiting for clarity on the outcomes of Operation Red Sunset, which could have far-reaching consequences for the future of crypto mining in the United States.