Trump-Xi Summit: 85% Rare Earth Grip Threatens Bitcoin Mining Costs

The Summit That Could Reshape Bitcoin Mining Economics

President Donald Trump and Chinese President Xi Jinping meet Thursday in Beijing for a summit both sides are framing around a single word: stability. The two largest economies have been locked in an escalating fight over trade, rare earth minerals, AI dominance, and the reopening of the Strait of Hormuz. For crypto markets, the substance of this meeting matters more than the optics. China’s stranglehold on rare earth minerals, the materials essential for manufacturing GPUs and ASIC mining rigs, means that whatever comes out of this summit could directly affect the cost of mining Bitcoin (BTC) for years to come.

The summit marks the beginning of a critical six-month negotiation window. The US-China tariff framework established in the Busan truce earlier in 2026 expires on November 10. Whatever goodwill the two leaders project on Thursday needs to translate into a successor agreement before that deadline. US Trade Representative Greer has emphasized that the American side is focused on tariff continuity and supply security, particularly for the rare earth minerals that feed both the semiconductor and mining hardware pipelines.

Why Rare Earths Are the Hidden Lever in Crypto Mining

China dominates the refining process for rare earth minerals, controlling roughly 85% of global refined rare earth output. Those refined materials end up in the magnets inside GPUs and ASIC miners, the workhorses of both AI training and Bitcoin mining. When China has previously restricted rare earth exports during geopolitical disputes, mining rig prices have jumped by as much as 25%. That price shock flows directly into the capital expenditure budgets of mining operations, compressing margins and slowing the deployment of new hash rate.

China’s 85% Rare Earth Leverage and Hardware Costs

The US is walking into this summit with a clear goal: secure predictable licensing and export commitments for rare earth minerals. Washington wants to prevent the kind of supply shocks that have previously rippled through hardware markets and, by extension, into Bitcoin’s hash rate economics. Any signal that rare earth exports will be restricted or weaponized further should be treated as a negative catalyst for mining stocks and, eventually, for network hash rate growth.

When hardware costs are predictable, miners can plan capital expenditure cycles with confidence. A sudden restriction, however, forces miners to either pay inflated prices for rigs or delay expansion. Both outcomes reduce the network’s hash rate growth trajectory, which in turn affects the security budget and, over time, the mining difficulty adjustment.

The 25% Rig Price Precedent

During previous periods of geopolitical tension, China’s export controls on rare earths caused immediate price spikes in the mining hardware market. A 25% jump in rig prices can turn a profitable mining operation into a break-even one, especially when Bitcoin’s price is not rising in tandem. Publicly traded mining companies with large fleets on order are particularly exposed. A prolonged disruption would force them to reassess their growth plans and could lead to equity dilution if they need to raise capital to cover higher hardware costs.

Key Metric	Value
China’s share of global refined rare earth output	85%
Previous mining rig price jump from export restrictions	Up to 25%
Chinese imports of Iranian crude oil	1.2 million barrels/day
Global oil supply transiting Strait of Hormuz	~20%
US-China tariff framework expiration	November 10, 2026

What “Stability” Means for Two Different Superpowers

The two sides appear to define “stability” in very different ways. A US official has described the American vision as a “low but durable floor” from which to build leverage.

Xi’s team, meanwhile, views the stability conversation as an opportunity to diminish US dominance in global economic architecture. For crypto markets, the divergence matters. If the US secures a predictable rare earth supply agreement, mining hardware costs stabilize. If China uses the summit to extract concessions while keeping rare earths as a strategic weapon, the uncertainty premium on mining stocks remains elevated.

The Tariff Continuity Question

US Trade Representative Greer has made tariff continuity a central demand. The existing tariff framework, which emerged from the Busan truce, has provided a temporary ceiling on certain technology-related imports. Without a successor deal by November 10, tariffs could snap back to higher levels, increasing the cost of importing mining hardware into the US. That would compound any rare earth supply disruption, creating a double squeeze on miners.

The Strait of Hormuz and the Energy Cost of Mining

Trump is also expected to push Xi on an entirely separate front: pressuring Tehran to reopen the Strait of Hormuz. China imports roughly 1.2 million barrels per day of Iranian crude oil, giving Beijing significant influence over Tehran’s economic calculus. The roughly 20% of global oil supply that transits through that narrow waterway makes it a choke point that affects everything from industrial electricity rates to the cost of cooling a mining facility in Texas.

Energy is the largest operating expense for Bitcoin miners. A sustained disruption in the Strait of Hormuz would push up global energy prices, raising the cost per terahash for every miner connected to a grid that relies on oil or gas-fired generation. Even miners with fixed-price power purchase agreements would eventually face higher renewal rates if the disruption persists.

The China-Iran Connection

Beijing’s leverage over Tehran stems from its role as the primary buyer of Iranian crude. If Trump can persuade Xi to use that leverage to reopen the strait, energy markets would likely stabilize, removing a tail risk for mining operations. If Xi declines, the energy risk premium remains, and mining stocks would continue to price in the possibility of higher electricity costs.

The November 10 Tariff Expiration: A Hard Deadline

The November 10 expiration of the US-China tariff framework is the next concrete milestone to track. The summit on Thursday is the opening move in a six-month negotiation that must produce a successor agreement. The rare earth supply chain is one of the most contentious items on the agenda. Without a deal, the US could face higher tariffs on imported mining hardware at the same time that rare earth export restrictions tighten.

Domestic Rare Earth Alternatives

China’s dominance in rare earth refining has been pushing US policymakers toward domestic alternatives for years. Companies working on rare earth processing outside China, whether in Australia, Canada, or the US itself, stand to benefit from the geopolitical anxiety regardless of the summit’s outcome. For miners, the emergence of non-Chinese rare earth supply chains would reduce the risk of future hardware cost shocks. That transition, however, is measured in years, not months.

Where the Risk Concentrates: Mining Stocks and Hash Rate Growth

The immediate risk from the summit concentrates in publicly traded mining stocks and the forward outlook for hash rate growth. Mining companies that have already ordered next-generation ASIC rigs for delivery later this year are exposed to any supply disruption that delays those shipments or raises their cost. A sustained increase in hardware costs would compress margins and could force some operators to scale back expansion plans.

The network hash rate, which has been growing steadily, would likely decelerate if new rig deployments slow. That deceleration would feed into the mining difficulty adjustment, potentially making existing rigs more profitable in the short term but signaling a less secure network over the medium term.

What Would Reduce the Risk

A concrete agreement on rare earth export licensing, combined with a tariff continuity deal, would remove the largest overhang. Mining stocks would likely reprice upward as the cost of future hardware becomes more predictable. The hash rate growth trajectory would remain intact, and the network’s security budget would continue to expand.

What Would Make It Worse

A breakdown in talks, followed by a snapback in tariffs and a new round of rare earth export restrictions, would hit mining hardware costs from both sides. Mining stocks would face a sharp repricing, and the network’s hash rate growth could stall. The November 10 deadline amplifies the urgency; the summit on Thursday is the first real test of whether the two sides can find enough common ground to avoid that outcome.

The crypto market has often treated geopolitical risk as a distant concern. This summit, however, connects directly to the cost of the machines that secure the Bitcoin network. Traders who ignore the rare earth dimension are missing the most tangible link between great-power politics and the economics of mining.