The use of the “N” word or national security risk has been on the rise when it comes to US-China relations as politicians fret about the rising power of China. In the most recent case, President Joe Biden has flagged MineOne which is a Chinese-backed cryptocurrency mining firm as a national security risk and barred it from owning land near a Wyoming nuclear missile base.

In his order, Biden said, “There is credible evidence that leads me to believe that” MineOne and related entities “might take action that threatens to impair the national security of the United States.”

The order gives MineOne Partners Ltd. 120 days to divest the property that it was operating as a crypto mining facility near the Francis E. Warren Air Force Base (Warren AFB). It however has to cease all operations with immediate effect and remove all equipment and structure in 90 days.

Naturally, we don’t know exactly what kind of “national security risk” this facility may have warranted, but it has something to do with potential surveillance capabilities because of its location near the Warren AFB.

MineOne Partners Ltd – a British Virgin Islands company majority owned by Chinese nationals – purchased the land in 2022 but did not notify The Committee on Foreign Investment in the US (CFIUS).

Chinese-owned cryptocurrency mines have blossomed in the US after China banned them in 2021 and are now present in over a dozen states. The country offers cheap electricity and a better legal system than China when it comes to cryptocurrency mining. 2024 has been a good year for cryptocurrencies and the market has continued to rebound with bitcoin rising to a new record high in March.

President Joe Biden Flags China Crypto Miner as a National Security Risk

The CFIUS is an inter-agency panel comprising members from the Justice, State, Energy, and Commerce Departments. It is headed by the US Treasury Department and was alerted about MineOne’s purchase of land after a public tip. The area is quite strategic and is within 1 mile of Warren AFB which is home to Minuteman III intercontinental ballistic missiles.

As the White House said in its statement, “The proximity of the foreign-owned Real Estate to a strategic missile base… and the presence of specialized and foreign-sourced equipment potentially capable of facilitating surveillance and espionage activities, presents a national security risk.”

While MineOne or China haven’t yet reacted to the order, US Treasury Secretary Janet Yellen said, “Today’s divestment order underscores President Biden’s steadfast commitment to protecting the United States’ national security.”

She added, “It also highlights the critical gatekeeper role that CFIUS serves to ensure that foreign investment does not undermine our national security, particularly as it relates to transactions that present risk to sensitive U.S. military installations.”

Whether we don’t know for sure whether MineOne was indeed spying or had intentions to spy, its location, nationality, and refusal to warn CFIUS were enough to convince the President to kick it out.

CFIUS Has Taken Such Actions in The Past Also

The CFIUS, which was established by President Gerald Ford’s Executive Order in 1975, has taken many such actions in the past. For instance, in 2019, it ordered Beijing Kunlun Tech Co. Ltd. to sell its interest in Grindr, a popular dating application focused on the LGBTQ community, apparently over concerns related to data about the sexual preferences of individuals which could potentially be misused. It worried that China could blackmail or influence government or military employees with this kind of information.

The same year, it forced Shenzhen-based iCarbonX to sell its majority stake in PatientsLikeMe, again over issues related to data of US citizens getting misused.

The agency, however, failed to block the investment from China-based Fufeng Group to build a $700 million wet corn milling plant about 12 miles from the Grand Forks Air Force Base in North Dakota as it did not have the jurisdiction. The Grand Forks City Council eventually voted to block that project but the CFIUS added eight more military bases to its jurisdiction after the fiasco.

The CFIUS is also reportedly probing Flannery Associates, a limited liability company registered in Delaware whose owners are publicly unknown, and has been buying up land around Travis Air Force Base, a key Air Force base in California.

Biden Is Considering More Tariffs on Chinese Goods

President Biden has imposed new tariffs on imports of semiconductors, electric vehicles, solar panels, and some medical supplies from China. Former President Donald Trump had already imposed tariffs on most Chinese products and ahead of the upcoming US elections both he and Biden want to be seen as tough on China (in a trade war sense). Trump also imposed tariffs on US steel and aluminum exports after the Commerce Department’s finding showed these threatened US national security.

Last month, Biden signed the Protecting Americans From Foreign Adversary Controlled Applications Act that proposes to ban TikTok unless ByteDance divests its stake. Republicans, too, can claim some credit for the law as House Republicans managed to include the TikTok ban as part of the massive Uniparty foreign aid package that Biden proposed for Ukraine, Israel, and Taiwan.

National Security Concerns Are Everywhere Apparently

The US has also banned exports of high-end chips to China over possible military use. There is an apparent “AI war” going on between the two countries and the US move to ban exports of high-end chips could stall the progress that Chinese companies are making in AI.

Both countries are worried about the data of their citizens and that was precisely the reason China ordered the ride-hailing app Didi to delist from the US markets shortly after its 2021 listing.

China has banned some US tech companies from selling goods to critical infrastructure in the country and has barred government officials from using Apple iPhones at work.

More recently, Tesla partnered with Baidu for data mapping, apparently to get approval to offer its full self-driving (FSD) functionality in the country. While we don’t know whether the partnership was forced upon Tesla – it goes to show how protective China has been regarding data related to self-driving cars. Incidentally, the communist country previously banned Tesla cars from military complexes over spying concerns.

All said, as the rivalry between the US and China only increases in the coming days, we could see them invoke national security more often while acting against companies doing business in their countries.