Bitmain Hires TSMC to Produce ASICs Using Its N5 Technology

The huge price increase most cryptocurrencies have experienced since the beginning of the year has made cryptocurrency mining one of the most profitable industries today. As the prices of Bitcoin and Ethereum reached their all time highs, miners began turning insane profits that haven’t been seen since the early days of the industry.

However, the huge increase in mining profitability has caused a significant decrease in the availability of high-performing chips used for mining. The world’s largest Bitcoin mining hardware manufacturers have been struggling to meet the demand from miners, as the entire world struggled with a lack of semiconductor chips due to the COVID-19 pandemic.

Bitmain, the world’s largest mining hardware manufacturer, seems to have found a workaround to this problem, enlisting the help of another Asian tech giant. According to the latest report from DigiTimes, Bitmain has reportedly hired Taiwan Semiconductor Manufacturing Company (TSMC) to start manufacturing its ASIC chips. TSMC will utilize its N5 fabrication technology process to produce the chip, as the company has already placed a “significant” order.

DigiTimes noted that TSMC is expected to begin producing Bitmain ASICs in the third quarter of the year and that it plans on “ramping up” its output for the company even more in the first quarter of next year. The N5 manufacturing technology offers unprecedented transistor density and power efficiency—much-needed features for the fast-paced and rapidly evolving world of Bitcoin mining. Chip models older than a couple of years are already struggling to meet the high demand of the Bitcoin network and are left behind in the mining race by their newer and much faster counterparts.

Given the fact that Bitmain’s latest and most advanced model, the Antminer S19j, has a hash rate of 90 TH/s and consumes around 3,100W of power, many believe that employing TSMC’s N5 fabrication process will make the upcoming miner even more powerful.

But, no matter how positive the news might be for miners, Bitmain’s relationship with TSMC has raised some eyebrows. Some experts questioned whether the demand for ASICs made with such new technology justified the company’s massive investment in TSMC. With the price of Bitcoin relatively stable at around $50,000, even the older versions of Bitmain’s Antminers are able to turn a profit.

Others, on the other hand, remain worried that Bitmain’s massive order will reduce TSMC’s ability to meet the demand of its other buyers. The company’s geographical centralization and dominance over the semiconductor market has been heavily criticized—TSMC supplies 95% of the world’s semiconductor chips from only three fabrication plants all located in Taiwan. TSMC’s N5 technology has already been adopted by Apple and Huawei, both of which caused massive chip shortages in the past.

Last month, TSMC revealed plans to invest $100 billion in the next three years into expanding its production capacity, putting at least part of the rumors to rest. Neither Bitmain nor TSMC have shared any details about the specification of the upcoming chips or its price.