Chinese Bitcoin mining hardware giant Bitmain is under federal investigation in the United States over concerns that its machines could pose national security risks, according to a Friday report from Bloomberg.
Anonymous officials familiar with the matter said Bitmain’s mining rigs are at the center of an inquiry known as “Operation Red Sunset,” led by the US Department of Homeland Security. Investigators are reportedly examining whether Bitmain’s ASIC devices could be remotely accessed for surveillance or used to disrupt parts of the US power grid.
The probe follows a prior US investigation into Xiamen Sophgo, a Chinese chip designer linked to Bitmain, over alleged ties to the US-sanctioned company Huawei in late 2024. Shortly afterward, US Customs and Border Protection halted shipments of thousands of Bitmain ASICs, releasing them only beginning in March of this year.
Bitmain dominates the global Bitcoin mining hardware market, controlling over 80% of ASIC sales, according to data from Cambridge. Together, Bitmain and fellow Chinese manufacturer MicroBT account for 97% of worldwide market share.
Some investigators even disassembled Bitmain hardware to look for malicious components, Bloomberg reported, though they declined to say whether anything suspicious was found.
A Bitmain spokesperson said it is “unequivocally false” that the company can remotely operate its machines. The company stated it complies with all relevant US laws, has never engaged in activities that could threaten US national security, and said it was unaware of the investigation.
Trump-linked mining company also exposed to potential fallout
Any restrictive action against Bitmain could directly affect firms connected to US President Donald Trump’s family. In August, American Bitcoin, a mining company backed by Trump family members, purchased 16,299 Antminer U3S21EXPH units from Bitmain.
The company also assumed ownership of nearly all of Hut 8’s mining fleet, including 31,145 Bitmain Antminer S21+ rigs acquired roughly a year earlier.
In September, American Bitcoin said it had secured “preferential access to next-generation ASIC compute infrastructure,” though it did not explicitly mention Bitmain. SEC filings show the company paid Bitmain using pledged Bitcoin, with 24-month redemption periods terms that The Guardian described as unusually favorable.
Given Bitmain’s dominant market share, many other US-based mining operations could also feel the effects of the federal probe. Earlier this year, several publicly traded mining firms experienced shipment delays tied to tensions between Washington and Beijing, offering a preview of potential disruptions if the investigation escalates.