Bitmain, embroiled in controversy, finds its strongest ally in the United States

Original Compilation: Luffy, Foresight News

Bitmain, once viewed by the United States as a national security threat and embroiled in controversies over miner safety and remote control, is the absolute dominant force in the global Bitcoin mining hardware industry. This mysterious Chinese company, after facing a White House ban and a Department of Homeland Security investigation, has unexpectedly formed a significant business alliance with Eric Trump, the second son of Donald Trump.

On one side is the Chinese mining giant questioned for endangering power grids and military bases; on the other is a Bitcoin company under the US presidential family. The two have built a super mining farm in Texas, embarking on a heavyweight collaboration. This article recounts this alliance intertwined with politics and تشفيرcurrency, revealing how Bitmain managed to stage a comeback from the US “ban list” to become one of the Trump family’s most crucial business partners. The following is the full translation:

The Mining Empire: The Mysterious and Monopolistic Bitmain

From dedicated data centers in the Texas countryside to converted timber mills in Borneo, rows of shoebox-shaped machines stand everywhere, emitting deafening roars that sometimes even draw complaints from neighbors. Each machine contains hundreds of Application-Specific Integrated Circuits (ASICs), produced at high cost in advanced factories in Taiwan. These chips are soldered onto three enclosed hashboards for brute-force computations, with all instructions issued by a control board. Depending on the specific model, the machines use built-in fans or liquid cooling systems to prevent components from overheating, consuming massive amounts of electricity wherever they are installed.

These devices have only one purpose: to crack Bitcoin’s underlying SHA‑256 algorithm. SHA‑256 is a so-called one-way function, meaning the only way to solve the mathematical puzzles it generates is through constant trial and error. Bitcoin miners make a living from this; once they calculate correctly, they gain the right to verify others’ transactions and receive Bitcoin rewards. Therefore, their profits directly depend on how many calculations these devices, named “Antminers,” can attempt per second: currently, it’s trillions of times per second. A top-tier Antminer sells for up to $17,400. Large mining companies own up to 500,000 miners, with upfront investments reaching tens of billions of dollars, but compared to potential returns, this capital expenditure is insignificant, at least when cryptocurrency prices are high. Some users liken it to owning a row of printers that print lottery tickets, except the odds of winning are much higher.

The Antminer is the flagship product of Bitmain Technologies Ltd. The company not only dominates the Bitcoin mining hardware production industry but, for most of its history, it virtually was the industry itself, with a market share exceeding 80%. Few companies globally achieve such absolute dominance: Alphabet Inc. in search is one; going back a few decades, perhaps De نحلةrs at its peak, which controlled over three-quarters of the world’s diamond production; or even centuries ago, institutions like the Dutch East India Company that monopolized long-distance spice trade. But unlike these historical monopolists, much about Bitmain remains a mystery.

Bitmain miners in a Chinese mining farm, 2017

The company is not publicly listed, and its official website does not publish a list of its global headquarters, CEO, or board members. The figure most closely associated with it is co-founder Jihan Wu, who rarely appears in public and is no longer chairman, but it’s unclear when he stepped down, who his successor is, or even if there is one. Until recent months, Bitmain’s spokespersons consistently refused to clarify even the most basic corporate structure and governance information, including the identities of major shareholders. As the company sells multiple miner models at different price points, estimates of its annual revenue vary widely. An executive who works closely with Bitmain and requested anonymity cited internal research estimating its annual sales between $2 billion and $3 billion. But even this figure is, at best, an educated guess.

However, two things are clear: First, Bitmain is headquartered in China; Second, it has formed an alliance with a child of President Donald Trump. Trump’s second son, Eric Trump, is the co-founder and Chief Strategy Officer of Miami-based American Bitcoin Corp. The company went public in New York last September, and his stake was valued at approximately $548 million at the time. (The stock price has since fallen significantly amid a broader sell-off in crypto assets.) Eric’s older brother, Donald Trump Jr., is also an investor, with an undisclosed stake size. American Bitcoin stated it plans to purchase thousands of Bitmain Antminers, aiming to eventually become the world’s largest Bitcoin mining company, and has partnered with this Chinese company to develop a large data center in Texas.

This collaboration represents a stunning reversal for Bitmain. Not long ago, it faced potentially existential challenges: escalating US investigations questioning whether its equipment constituted a national security threat. In May 2024, the White House ordered the removal of thousands of Bitmain miners from a mining site near a US Air Force nuclear missile base. Last year, a report from the Senate Select Committee on Intelligence warned that the presence of Bitmain miners near some military bases “poses an unacceptable risk.” In November, Bloomberg reported, citing a US official and other informed sources, that Bitmain had been the focus of a US Department of Homeland Security investigation aimed at determining whether Antminers could be remotely controlled to disrupt power grids or repurposed for espionage. Sources said the investigation, codenamed “Operation Red Sun,” began during the Biden administration and continued at least into the early days of Trump’s second term, with discussions held by the National Security Council under both administrations.

Bitmain did not respond to detailed inquiries about potential security risks but stated in a December declaration that the company complies with all applicable laws and that reports of it being under investigation are “seriously inconsistent with the facts and constitute fake news.” An American Bitcoin spokesperson said the company “adheres to strict standards regarding national security, grid stability, and operational safety” and “believes that, as long as mining hardware is deployed according to modern industrial security standards, it does not pose a threat to the US power grid or national security.”

Bitmain’s Irene Gao, photographed in 2025

The current status of “Operation Red Sun” remains unclear. The Department of Homeland Security told Bloomberg Businessweek it “cannot comment on ongoing investigations.” But Bitmain’s collaboration with American Bitcoin continues, and its aggressive push into the US has not stopped. In recent months, the company has opened up slightly to the outside world. For this report, Bitmain arranged an interview with its Global Sales Director, Irene Gao. She praised Trump’s pro-crypto policies as “a very good thing in the eyes of most of our clients,” but she evaded simple questions such as the names of core managers besides CEO Yang Cunyong. “We just don’t want to disclose any company information in this way,” Irene Gao said.

Security Shadows: US National Security Investigations and Containment

Beyond speculators seeking quick wealth, the crypto industry has attracted two types of people from its inception: tech geeks and true believers. The former focus primarily on the computational and mathematical challenges of creating and trading digital assets; the latter are obsessed with the potential of these tools to transform global finance.

The two Chinese entrepreneurs who founded Bitmain belonged to these two camps respectively. Jihan Wu came from a chip design background and had previously founded a startup developing TV set-top boxes. Micree Zhan was an investment analyst who later became obsessed with cryptocurrency; notably, he was the one who translated the original Bitcoin whitepaper from English to Chinese. Their collaboration began over dinner in Beijing in 2013. Zhan once said he went to Wikipedia the next morning to read about cryptocurrency and immediately decided to start a business with Wu. According to multiple sources who have had contact with both and requested anonymity for fear of reprisal, the two share some characteristics: both are somewhat socially awkward, have maintained extreme discretion for most of their careers, rarely appearing publicly or giving interviews; sources said both can become irritable under pressure, and the deep, hoarse-voiced Zhan has been witnessed loudly berating employees in the office, audible throughout the building.

When Zhan and Wu founded Bitmain in 2013, Bitcoin mining was not dominated by massive data centers operated by listed companies as it is today. It was a world of enthusiasts frantically chasing the latest cutting-edge equipment. That year, Bitcoin first broke $1,000, the cryptocurrency was still in its infancy, and the vast majority of coins had not yet been mined. At that time, better mining hardware could still lead to significant increases in the network’s total hash rate, a measure of the computational power required to process transactions. As long as miners could get their hands on the most advanced miners quickly, they were guaranteed profits.

Bitmain employees, 2017

Bitmain launched its first miner, the Antminer S1, in November 2013. By today’s standards, it was very rudimentary, even lacking a casing, with hashboards and wiring exposed. But as one of the earliest ASIC-based miners and arguably the most powerful device at the time, it represented a qualitative leap over competitors and drove the industry’s shift toward specialized hardware. Subsequent generations of Antminers saw even greater progress, with each iteration almost reتحديning the market: if miners didn’t buy the latest model, they simply couldn’t compete.

Bitcoin’s price surged over 250% in 2017, further boosting demand for Antminers. A private funding round in mid-2018 valued Bitmain at $12 billion. Its growth attracted widespread attention; a new funding round in August 2018 even landed on Jeffrey Epstein’s desk. Communications between Epstein and his advisors released by the US Department of Justice in January this year show the disgraced financier was eager to invest up to $3 million in Bitmain’s holding company but had some concerns about the deal structure. The documents do not indicate whether this investment ultimately went through.

Shortly after this communication, Bitmain filed for an IPO in Hong Kong, disclosing revenue of $2.5 billion, a significant increase from $137 million two years prior. The prospectus showed Zhan held about 36% at the time, and Wu held about 20%, both with paper fortunes in the billions. Other shareholders included Sequoia Capital China, IDG Capital, and Coatue. But betting wealth on rising cryptocurrency prices also meant facing disaster when prices fell. As the market crashed again, the listing plans were ultimately shelved. The entire industry entered the so-called “crypto winter,” a prolonged period of low prices. Meanwhile, cracks appeared in the partnership between Zhan and Wu. According to informed sources requesting anonymity, the disagreement stemmed from a strategic dispute: Zhan wanted Bitmain to venture into artificial intelligence, repurposing chips for applications like training facial recognition technology; while Wu, the true crypto believer, opposed deviating from the company’s original mission.

In late 2019, Wu attempted to take full control of the company, and Zhan was removed from his positions as legal representative and chairman of Bitmain. Zhan promptly filed a lawsuit in the Cayman Islands, where Bitmain’s holding company is registered. A protracted power struggle ensued, culminating dramatically in a physical altercation at a government office in Beijing. Former journalist Hazel Hu witnessed the scene in 2020. She recalled that while Zhan was waiting at the Haidian District سوق Supervision and Administration Bureau to collect Bitmain’s paper business license, his supporters clashed with Wu’s supporters present, wrestling over the documents. Police soon arrived from a nearby station to stop the conflict, which had spilled downstairs and into the street.

The following year, Wu admitted defeat and resigned as Bitmain’s CEO and chairman. (The dispute was eventually settled; Wu now serves as chairman of mining hardware manufacturer Bitdeer Group and a crypto investment platform.) Despite internal turmoil, Bitmain continued to expand, especially after Bitcoin prices resumed their upward trend in 2020. As the mathematical puzzle between mining companies and profits became increasingly complex, Antminers became a necessity. “They are the most efficient devices available right now,” said Vishnu Mackenchery, Senior Director of Corporate Development at US-based Compass Mining.

Antminers being assembled at a Shenzhen factory

At that time, Bitmain’s sales were highly concentrated in its home market. Data from the Cambridge Centre for Alternative Finance showed China accounted for about three-quarters of global Bitcoin mining hash rate in 2019. But in 2021, the Chinese government cracked down severely on the crypto mining industry, citing high energy consumption and carbon emissions. The result was a massive exodus of miners to regions with relatively cheap electricity and friendly regulatory environments—conditions particularly prominent in parts of the United States. As a hardware manufacturer, not a mining operator, Bitmain was not shut down, continuing operations in Beijing and establishing distribution centers across Southeast Asia. But from then on, its future would be determined by the United States.

After China’s policy shift, Bitmain increased sales to US miners and expanded a side business managing mining operations for US clients. To create a public face for the company in the US, it also transferred Irene Gao stateside. Irene Gao joined Bitmain shortly after graduating university in 2016; when she first arrived in the US, she lived out of a suitcase for years, traveling between cities pitching products to clients. As with much information about Bitmain, sales figures and market share during this period remain opaque, but industry veterans say it undoubtedly became the dominant player.

However, the company soon felt the impact of geopolitical tensions. During Trump’s first administration, the White House imposed 25% tariffs on various Chinese-made electronics. Bitmain began transshipping products through Thailand, Malaysia, and Indonesia—a common practice among Chinese manufacturers but considered a violation of customs rules by US authorities. President Biden largely maintained these tariffs. In 2022, US Customs and Border Protection inspected a shipment of Antminers destined for Connecticut-based mining company Sphere 3D Corp. After disassembling one device, inspectors found tiny “Made in China” labels on internal components. According to Sphere 3D’s then-CEO Patricia Trompeter, the entire shipment of 4,000 miners was detained for three months. Fearing further delays, some miners began diversifying risk by shifting orders to competitors who had already established production bases in the US, something Bitmain had not done at the time.

The most serious allegations against Bitmain were far more lethal than tariff evasion: whether its miners could be tampered with for purposes other than mining. Suspicions began circulating in crypto circles as early as 2017 when an industry media outlet reported that Antminers contained built-in code allowing Bitmain to remotely shut them down. The company quickly confirmed the code’s existence but stated its purpose was legitimate: to disable miners if stolen, similar to Apple allowing users to lock lost iPhones. Bitmain later said it had removed the feature, but two years later, tech bloggers discovered similar code; the company subsequently released a security patch.

According to a source familiar with confidential internal deliberations who requested anonymity, during the Biden administration, US officials commissioned studies to assess whether Bitmain miners and other Chinese-made mining hardware could pose national security risks. The source said the investigation revolved around two distinct lines of inquiry: First, whether miners could be used for espionage. Crypto hardware experts considered this possibility extremely low, if not impossible, given their highly specialized engineering. Second, and of greater concern to US officials: the potential impact of remote shutdowns on the US power grid.

When a large electricity consumer (e.g., a steel plant) goes offline, it’s typically a planned, gradual process, with power consumption dropping over two days or more. A Bitcoin mining farm can consume comparable power but can shut down in seconds. The source said US officials worried such a “shock event” could cause a sudden imbalance between power generation and consumption, potentially destabilizing the electricity supply. The most frightening scenario: a remote order from China shutting down thousands of Bitmain miners located near military bases or other critical infrastructure relying on the same power source. “Anyone who hacks into an entire data center, whether it’s AI, crypto, or cloud services, could cause serious damage to the grid,” said Michael Bedford Taylor, a professor of electrical and computer engineering at the University of Washington, though he cautioned that Bitmain itself was unlikely to have the motivation to do so.

In the spring of 2024, the Biden administration publicly expressed security concerns about a mining site. Located on 12 acres near Cheyenne, Wyoming, a company with Chinese links had installed up to 15,000 miners there, mostly from Bitmain. The site’s investors hoped it would one day become one of the largest in the US, benefiting from Wyoming’s low land costs and abundant electricity. It happened to be about a mile from Warren Air Force Base, one of three bases where the US Air Force deploys land-based nuclear missiles.

On May 13, 2024, Biden issued an executive order forcing the site operator, MineOne Partners LLC, to shut down the project. The document stated the Committee on Foreign Investment in the United States had “identified national security risks.” Although not explicitly mentioning grid concerns, the order noted risks included “the presence of specialized foreign-sourced equipment that could facilitate surveillance and espionage.” The miners were soon loaded onto trucks and removed.

Political Alliance: Partnering with the Trump Family for a Comeback

This was a major and public setback, with the US government explicitly linking Bitmain equipment to at least the possibility of malicious use. Yet, just months later, the company began advancing a project that could completely change its situation.

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