Bitmain announces the improvement of Bitcoin mining chips 7 nm, prices and centralization of the network

Bitmain announced its next generation of mining ASIC for Bitcoin, Bitcoin Cash and other SHA256 parts. The increasing difficulty of manufacturing these computer chips raises concerns about the decentralization of the network for these crypto-currencies.

Bitmain is the second largest factory-free chip maker in China and the largest cryptocurrency in the world. mining hardware manufacturer. The company also has a huge mining operation, commanding from 3 to 15% of all bitcoins mining.

The company announces a series of 17 series antminers with improved 7nm chips

Recently, the company announced an improved 7nm computer chip for mining which offers a supposed 28.6% improvement in energy efficiency, as well as a higher hash rate than previous models.

The chip pushes the limits of what is possible in terms of transistor density, the physical part of a computer chip that defines the number of calculations it can perform. According to Yangxin, the product manager behind the Series 17 Antminers:

"The driving force behind the development of the next-generation miners beyond the 7-nm chips is slowing because of physical constraints. With the reduction in size in nm, a quantum effect – when the dimensions of a device become very small due to scaling and other requirements – will most likely take place. It is promising that TSMC (Taiwan Semiconductor Manufacturing Company) is already building 5 nm chips. We will continue to monitor the development of this technology, but it is still early. "

Yangxin, product manager for the Antminer 17 series, said the indicators to be taken into account when evaluating a new chip are energy efficiency and hash rate.

The exact specifications have not been published, but CryptoSlate has contacted a crypto-hardware lab and will receive the exact performance of the Series 17 as soon as it will receive the Bitmain test templates.

Given the limits of the next 5 nm chips, 7 nm will remain the most economical in terms of cost:

"Given the rapid pace of development in this area in recent years, the sector should soon find what the next generation would be like. In the near future, 7 nm will remain the most popular in terms of performance and economy, "Yangxin said.

Extract the most money from minors

But according to Kristy-Leigh Minehan, chief technology officer at Core Scientific, the most important metric of their publication is missing: price. According to her, "the miners always measure the turnaround time". In addition, a source close to Bitmain said that the company's sales manager had not yet set prices for new models.

Unlike other equipment, whose price is usually based on the cost plus the margin, cryptocurrency miners are charged according to the time needed to purchase the equipment to reach the breakeven point. Historically, Bitmain aims to provide minors with a break-even point of 6 to 12 months.

"At the moment, an S9 used costs around $ 13 per TH / s. To be acceptable in today's production market, the S17 should be $ 14 to $ 15 per TH / s to justify the equipment change. Due to the overflow of S9 and 841 on the market and the current price of Bitcoin, the demand for newer hardware is much, much lower. "

In addition, Minehan goes on to mention the overabundance of S9, an old Bitmain model. ASICthat the miners could buy instead of the newer model:

"Why should I replace my equipment and expose myself to a much longer return on investment, while I could double the stake and buy a lot of used S9? Under Core Scientific, thanks to our optimizations, we are able to generate a return on investment. [break-even] with a used S9 in just three or four months. "

Finally, it is necessary to compare the new S17 series with competing manufacturers:

"You also have to compare MicroBT products: an M20S, for example, totals 72 TH / s, with 46 W per chip. Bitmain will have to have a similar specification or "beat" them entirely to "claim" the throne back from MicroBT, "said Minehan.

Centralization issues around Bitmain

Producing competitive ASICs (application-specific integrated circuits) requires a huge amount of research, development and manufacturing capital. As a result, there is only a handful of profitable Bitcoin. ASIC manufacturers.

As a result, only a few companies have direct access to profitable activities. mining hardware for Bitcoin. This is a highly centralizing force for the distribution of nodes on the Bitcoin network. Bitmain is able to control who and where mining occurs and can continue to increase its share of the network hash rate if desired.

That this poses a real risk to the Bitcoin network is another problem. If Bitmain attacked the network at 51%, the price of bitcoin would be compromised, which would probably have the effect of killing its activity and rendering its ASIC worthless.

That said, 51% of people who attack other smaller pieces of the SHA256 family are actually encouraged. Such a scenario was seen during the hash wars of Bitcoin Cash. Bitmain, or another big miner, could sack another SHA256 and return to mining Bitcoin, presenting little risk for the minor.

In the SHA256 algorithmItems vulnerable to attack by 51% include Bitcoin Cash, Bitcoin SV, Litecoin Cash and Peercoin. Due to this dynamic, cryptocurrency holders that are not the most important in hash rate within a mining algorithm must be aware of the risks badociated with the proof of work.

Filed under: Bitcoin, Mining, Price Monitoring, Technology