Bitcoin Mining: The Key to a Domestic Chip Industry Trump’s victory signals massive incoming nation-state Bitcoin adoption. Bitcoin is now officially an important geopolitical resource.. Probably the most important one… Purchasing power will be defined in Bitcoin and nations will want to own as much as possible. Bitcoin mining gives nations the ability to conduct the most important economic transactions (and impede competitors from doing theirs). Not having domestic mining operations will be a vulnerable position to be in… Bitcoin mining also offers nations a unique chance to strengthen important domestic industries. Hash Wars: The New Battleground for Nation-States Nation-state competition will revolve around control over hash rate, the computational power securing Bitcoin's network. Countries that dominate hash rate will have the power to control transactions on the Bitcoin network. Bitcoin mining relies on advanced chips, such as Application-Specific Integrated Circuits (ASICs), designed for maximum efficiency. This creates consistent demand for cutting-edge semiconductor technologies. Nations embracing Bitcoin mining are uniquely positioned to redirect this demand into developing domestic chip development capabilities. Transforming Bitcoin Demand into Chip Innovation The demand generated by Bitcoin mining offers a great opportunity to boost local chip production. By encouraging miners to source chips domestically, nations can create a cycle of innovation and investment. This approach will help develop a domestic ecosystem around the production of technologies needed for Bitcon mining and reduce reliance on foreign suppliers. Chip manufacturing will be one of those industries and produce chips, not only for Bitcoin mining, but for every industry that needs them. Bitcoin Mining will Drive Energy Abundance Bitcoin mining doesn’t just impact technology—it also drives energy innovation. Mining operations naturally want to find the cheapest energy sources. This will lead to breakthroughs in cheap energy because mining operations will make more energy projects profitable. This allows more energy sources to come online… This increase in supply will cause a decrease in electricity prices, from which resident areas and other industries also profit. Winning the Bitcoin Race with Smart Policies To optimise the potential of Bitcoin mining, governments should adopt a strategy that encourages mining AND encourages domestic sourcing of mining equipment. Nations should actively encourage Bitcoin adoption and mining operations, ensuring they are a serious participation in the global Bitcoin economy. Removing capital gains tax on Bitcoin and lowering corporate taxes for mining companies would be a good start. Second, incentives should be established for mining companies to source chips and other equipment domestically. Finally, governments must invest in research and development partnerships with universities and private firms to build a competitive semiconductor industry. The Only Path to Sovereignty Bitcoin mining presents a transformative opportunity for nations to bolster domestic chip industries and achieve energy abundance. By aligning policy with Bitcoin's economic incentives, nations can extend the benefits of Bitcoin into other industries and thus into the lives of its citizens. Adopting Bitcoin and Bitcoin mining is not only a great opportunity for nations, it is an absolute must. Nations that fail to do so are doomed to a fate of servitude to nations that did have the vision to adopt this new paradigm.

Bitcoin mining with locally developed chips will also drive other industries like AI, cars, telecommunications and much much more.

Encouraging miners to source chips domestically creates a cycle of innovation and investment. Nations gain both tech leadership and reduce reliance on foreign suppliers.

Bitcoin mining offers a shortcut to develop a domestic semiconductor industry

Bitcoin mining relies on cutting-edge chips, like ASICs, for efficiency. This creates unlimited demand for advanced semiconductor technologies.

Countries that dominate hash rate gain unparalleled power: control over transactions

Control over hash rate is the new arms race. The computational power securing Bitcoin's network will define global prominence.

Bitcoin mining is not just about hash rate. It’s also a great opportunity for nations to strengthen vital domestic industries. The chip sector is the most important one.

Purchasing power will be defined in Bitcoin, and nations will compete to own as much as possible. Owning hash rate = controlling transactions. No mining? No influence.

Trump’s victory is the official start of the Great Power Hash Wars. Bitcoin is now officially an important geopolitical resource.

If the US doesn't want to pay Bitcoin for Chinese goods, its only choice is to innovate and produce goods that China and the world genuinely desire.

The US will be just as reluctant to supply Bitcoin to China as Britain was with silver, but it won’t be able to rely on force

The modern Opium War seems unlikely to succeed—China’s military and tech gap with the US is far smaller than it was with Britain in the 1800s

The US may even try military pressure to force China to accept anyting but Bitcoin for their trade deficits.

The US may very well attempt economic coercion and sanctions if China demanded it only pay with Bitcoin for the trade deficit

Nations will be reluctant to part with their Bitcoin reserves, but will need vital products...

The Modern Opium War will be Fought over Bitcoin The Opium Wars of the 19th century were about silver. The 21st century equivalent will be about Bitcoin. In the 1800s Britain desired Chinese goods (tea and silk) but produced nothing the Chinese desired. China only wanted silver, and Britain’s silver reserves went down fast. Britain solved this by militarily forcing China to accept opium, for which the decaying Qing society had a high demand. With the rise of Bitcoin as the economic resource nations compete over, we might see a similar dynamic play out in the future: The US having a high demand for Chinese products, but producing nothing the Chinese want. Reluctant to see its strategic Bitcoin reserves dwindle too fast, the US might try to force China to accept anything else but Bitcoin. What if the US Produces Nothing the Chinese Want? Today’s trade landscape echoes the 19th-century economic imbalance that fueled the Opium Wars. The US imports vast amounts of goods from China but has fewer products China desires in return. China, as the “factory of the world,” produces everything from high-tech components to consumer goods. The US further restricts exports of key technologies, like semiconductors, limiting its appeal in China’s eyes. If China were to accept only Bitcoin, the US could face a strategic dilemma. It will be reluctant to see its strategic Bitcoin reserves go to China and will seek to find other ways to resolve its trade balance with China. Will the US Try to Force China, Like the British Did? China only accepting Bitcoin will put the US in a similar position as Britain in the 1800s. Facing a trade imbalance and dwindling Bitcoin reserves is not a situation the US will be comfortable with. What will it do about it? Will the US try to pressure China through economic means, or might it even try to use its military to force China to accept anything but Bitcoin? What Strategies Could the US Employ? The US may consider various strategies to avoid draining its Bitcoin reserves. Economic coercion is one, with the US imposing sanctions to pressure China into accepting other currencies or products. However, the trade imbalance means that China is less dependent on the US than the other way around. Alternatively, the US might consider military pressure to get what it wants. This is also unlikely to succeed since the military and technology gap between the US and China is much smaller than between Britain and China in the 1800s. History Will Not Repeat Itself The US will attempt to maintain its economic dominance, but history is unlikely to repeat itself in the same way. What will be the same is that the US will be just as reluctant to supply Bitcoin to China as the British were to supply silver in the 19th century. But the US is unlikely to impose its will on China through sanctions or military force. The only choice it will have is to innovate and produce goods that China and the world genuinely desire. Another example of Bitcoin forcing nations to innovate and compete peacefully…

China only accepting Bitcoin for its exports will put the US in a difficult position.

The US restricting key tech exports to China means China is more likely to demand Bitcoin for its exports to the US

China, being the “factory of the world,” is in a good position increase its Bitcoin reserves.