The U.S. Department of Homeland Security has been investigating Chinese Bitcoin mining equipment manufacturer Bitmain as a potential threat to national security, according to seven people familiar with the matter.
Unnamed sources told Bloomberg that a federal investigation, led by the DHS and codenamed Operation Red Sunset, has focused on the question of whether the firm’s mining hardware could be controlled remotely for espionage purposes, or even to undermine the U.S. power grid.
This investigation has been conducted at the same time as inquiries by the Senate Intelligence Committee, which in July published a report that concluded that Bitmain’s machines “can be forced by the PRC to turn over data in accordance with China’s national security law.”
The same report also declared that Bitmain’s miners have “the capability to be remotely controlled by Bitmain personnel in China,” citing a New York Times article from October 2023 which reported on the discovery of ‘backdoors’ in Bitmain equipment as far back as 2017.
Federal suspicion of Bitmain predates the current Trump administration, with then-President Joe Biden issuing an order in May 2024 that prohibited MineOne Partners from operating a mining facility close to Francis E. Warren Air Force Base.
One of the primary concerns underlying this disinvestment order was that MineOne Partners’ facility used “foreign-sourced” equipment that presented “significant national security concerns.”
Such concerns have remained under the current administration, despite the fact that President Donald Trump’s two sons have links to American Bitcoin, which agreed to purchase 16,000 Bitmain machines this year in a deal worth $314 million.
Bloomberg’s report suggests that The Department of Homeland Security’s investigation was complemented by discussions at the White House’s National Security Council, where inquiries began under the Biden presidency and continued into “at least the early months of the Trump administration.”
Federal customs officials have also stopped and inspected Bitmain equipment at U.S. ports on various occasions, while the federal investigation into Bitmain has considered whether tariff violations may also be occurring.
Bitmain has rejected any claims that it can remotely control its machines, informing Bloomberg in a statement that it “has never engaged in activities that pose risks to U.S. national security,” and that it has not received any information regarding any federal investigation into its products.
Decrypt has reached out to Bitmain for comment and will update this article should they respond.
Could miners be controlled remotely?
Some mining experts suggest that while U.S. security concerns over foreign-made hardware are common to the wider tech industry, as in the case of Huawei, remotely controlling mining machines would be hard to do while remaining undetected.
“These machines are purpose-built to do one thing, mine Bitcoin, so a backdoor would mainly enable remote tweaks like switching pools, changing settings, or turning units on and off,” said Nishant Sharma, the founder of mining consultancy and communications firm BlocksBridge.
Sharma told Decrypt that, in large data centers, external interference would be “hard to hide,” because operators closely monitor their centers’ hashrate and network traffic.
He added, “And unlike PCs or GPUs, most miners in industrial fleets have no Wi-Fi and very limited interfaces, they are fairly dumb devices from a security standpoint.”
