Bitcoin miners, it turns out, aren’t always playing by the rules. A quiet game of lowballing has been going on with U.S. Customs and Border Protection, folks undervaluing shipments of those power-hungry mining rigs. It’s a way to dodge tariffs, plain and simple. And with Trump back in the picture, and tariffs looming, this little habit is getting a lot more attention.
- Some Bitcoin miners are undervaluing their ASIC mining rig shipments to the U.S. to avoid tariffs, a practice that has become more scrutinized with the potential return of Trump-era tariffs.
- This practice of underreporting shipment values, while risky and illegal, was initially driven by the shift of mining gear manufacturing from China to Southeast Asia and subsequent tariffs imposed on those goods.
- While customs enforcement is tightening and penalties exist for fraudulent declarations, the inconsistency in enforcement across different states and shipping carriers creates loopholes that some miners exploit.
Jill Ford, who runs BitFord Digital – a company that sources equipment for miners – put it bluntly. People are declaring lower values on packages. Risky? Absolutely. Illegal? You bet. But it’s happening. She’s not suggesting it, mind you, but she’s seen it. The whole thing started because, well, China used to make almost all the mining gear, and then suddenly, they weren’t allowed to. So, everyone scrambled to the U.S., especially Texas, and the demand for these machines – ASICs, they’re called – went through the roof. But those ASICs still mostly come from Chinese companies, manufactured in Southeast Asia.
The Tariff Tango
The Trump administration threw a wrench into things with new tariffs on goods from Malaysia, Thailand, and Indonesia. A 90-day pause was thrown in for negotiations, but the uncertainty is real. Miners are sweating, wondering how much these taxes will add to the cost of keeping their digital gold mines running. But even *before* the tariff talk, underreporting was common. Taras Kulyk of Synteq Digital says his company doesn’t do it, and he’s seen plenty of others who do. “It’s fraud,” he said. Ford admits she’ll declare whatever value a client asks for, but if the package gets flagged by customs, that’s on them.
Things have tightened up recently, though. Used to be, a $3,000 machine could be declared as $300 and sail right through. Now? Customs is checking. Ford says it’s harder to get away with anything, maybe 20 or 30% under value, but not the huge discounts they used to pull off. The size of the shipment matters. A couple of machines? Probably fine. Hundreds of thousands? Expect a closer look. And it’s not uniform. Oregon seems to be a breeze, while Kentucky… well, Kentucky is a nightmare. One client had 100 machines worth $9,000 apiece stuck there. They ended up shipping them back to Hong Kong and looking for a different entry point.
Even the shipping carrier matters. DHL is easier through Kentucky, UPS is easier on the West Coast. It’s common knowledge, apparently. But the shipments expert Ford spoke with thinks this inconsistency is temporary. Customs is cracking down, but it’s taking different states different amounts of time to get on board. CBP didn’t respond to requests for comment, which isn’t surprising.
Ford later clarified things a bit, saying the problem wasn’t really driven by miners themselves. It was Chinese suppliers routinely undervaluing shipments for years. It was just how things were done, and regulators largely ignored it. Now, with tighter enforcement, people are starting to realize declaring things properly might be the better route.
It’s worth noting Ford has a bit of a past. She served time for bank fraud and money laundering related to a COVID loan. She’s “orange-pilling” inmates, apparently, whatever that means. But she’s built a $20 million business since getting out, so she’s clearly doing something right.
Who’s on the Hook?
The responsibility for declaring the value of a shipment falls to the “importer of record” – the supplier, the broker, or the end-client. Customs can audit these declarations and hit importers with fines or demand back duties if they find discrepancies. The Department of Justice even has a unit that goes after people defrauding the government. Penalties can be three times the damages, or even jail time, though that’s rare. Until recently, penalties were just seen as a cost of doing business. But with Trump’s focus on tariffs, that might be changing.
The combination of tariff uncertainty and increased scrutiny is making some miners rethink their plans. About half of Ford’s clients are still moving forward, while the other half are hitting pause. One client is holding a container in China, hoping to avoid hefty tariffs. Kulyk predicts tariffs will slow down new projects and force existing ones to scale back. Canada, he says, is looking pretty good right now.
Ultimately, this whole situation is a reminder that even in the decentralized world of crypto, real-world regulations still apply. And sometimes, those regulations are a bit of a mess. It’s a game of cat and mouse, and right now, Customs seems to be sharpening its claws.
