Bitcoin ASIC producer Canaan has completed its first pilot production run in the United States, signaling a strategic pivot in its operations. This move mirrors its Malaysian manufacturing model and comes as the company sharpens its focus on crypto infrastructure by exiting the artificial intelligence (AI) hardware sector.
“Our core strength lies in crypto infrastructure and Bitcoin mining,” said Canaan CEO Nangeng Zhang. “Doubling down on these areas is the most strategic path forward for us.”
Canaan CEO Nangeng Zhang
While acknowledging higher production costs in the US, Canaan views this initiative as a strategic hedge against tariffs and a long-term investment in resilience.
A Strategic Realignment for Growth
Canaan’s decision to exit the AI chip business underscores a commitment to focusing on its primary market—Bitcoin mining. By realigning its resources, the company aims to strengthen its position as a leading ASIC manufacturer.
Canaan controls 2.1% of the Bitcoin mining ASIC market. Source: Cambridge Digital Mining Industry Report
Producing closer to North America enables Canaan to reduce delivery times, better meet local demand, and navigate geopolitical or regulatory challenges. This approach also aligns with industry trends, as competitors like Bitmain and MicroBT are expanding their production capacities in the US.
Navigating US Tariffs and Compliance
Canaan’s US expansion is driven partly by the complex tariff environment. Currently, ASICs produced in Malaysia are subject to a 10% tariff when shipped to the US. Tariff uncertainty on components and raw materials further complicates cost planning.
To ensure long-term commercial viability, Canaan plans to optimise its cost structure, manage production expenses, and respond to evolving customer demand. The company also emphasised its commitment to aligning with US technology and security standards, addressing concerns over national security compliance.
This comes in the wake of incidents like the US Customs and Border Protection Agency halting Bitmain ASIC deliveries in 2024 due to alleged ties between a Chinese supplier and a US-sanctioned firm.
A Long-Term Vision for US Operations
Canaan sees its US pilot production as a stepping stone toward establishing a more robust North American presence. “This is not just a hedge against tariffs,” a company representative said, “but also a strategic investment in building resilience and responding to future market shifts.”
The company aims to refine its US operations, ensuring sustainable production costs and scalability. As geopolitical uncertainties persist, Canaan’s efforts to diversify its production base could position it as a leader in the Bitcoin mining hardware industry.
Focused on the Future
Canaan’s pivot to core crypto operations and expansion into US production highlights its commitment to long-term growth and resilience. By addressing regulatory challenges and refining its cost structure, the company is poised to strengthen its position in the competitive Bitcoin ASIC market while adapting to the evolving global landscape.
