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Cryptocurrencies fuel booming mining economy, semiconductor innovation

Reports illustrate that cryptocurrencies have fuelled rapid gains from semiconductor manufacturing companies in addition to propelling new mining ventures.

Despite the turbulence witnessed in wider cryptocurrencies throughout both January and February thus far this year, market information reveals that digital currencies have succeeded in fuelling the burgeoning mining industry to new heights, in addition to creating a wider mining economy which several new firms have thrived in.

Manufacturers producing Graphics Processing Units (GPUs) as well as Application-Specific Integrated Circuit (ASIC) have seen rapid growth fuelled by new interest in cryptocurrency mining. Firms such as Nvidia have witnessed share price growth from $117.31 to $213.70 in the period of one year alone, while TSMC’s share prices similarly grew from $184.50 to $239.00 USD in the same time period.

TSMC, specifically, which not only supplies Apple with chipsets but further Qualcomm and Nvidia, raked in some $4.4 billion USD in net profit during 2017; marking a market value growth of just over 38%.

Markets have seen significant interest in 16-nanometer (16nm) chipsets which are typically leveraged for Bitcoin mining, while chipsets found in smartphones (typically between 10nm and 12nm) have seen renewed interest as well.

Other entities, such as Japanese firm DMM Group, have shown interested by developing a ‘crypto mining lab’ with the view of developing the “the highest per unit hash power” through creating custom machines.

Expansion

The news has also seen semiconductor manufacturing companies mark significant expansion; significantly, TSMC announced in September of 2017 that it would build a new, world-first three-nanometre fab in Taiwan.

Cryptocurrency mining firms have been swift to joint he action – Bitmain Technologies continues to mass-produce ASIC rigs leveraging 28nm and 16nm semiconductors, while reports recently indicated that the firm has reportedly ordered 100,00 12nm chipsets from TSMC.

New interest

Leading technology giants have further expressed their interest as well. Earlier this year, Samsung announced a new deal that will see it enter the ASIC market.

In conversation with The Bell, Samsung Securities analyst Hwang Min-seong quipped that “Samsung Electronics could increase its revenues through ASIC chip manufacturing but because the foundry only accounts for a small portion of the company’s semi-conductor manufacturing plant, it is difficult to predict that the firm’s mining venture will have a significant impact on the company’s revenues.”

The South Korean company made an interesting first foray into the cryptocurrency mining space in 2017, where the firm repurposed forty elder Galaxy S5 handsets to serve as a custom Bitcoin mining rig.

The S5-based rig was developed as part of the company’s ‘upcycling’ initiative, which aims to repurpose elder or aging hardware and to develop new applications around deprecated technology.

Kodak has further announced the presence of its own Bitcoin mining rigs, dubbed the Kodak KashMiner, which would be installed at its headquarters in Rochester in New York.

Kodak’s KashMiner arsenal will be powered by the company’s on-site power plant, where consumers will be able to rent mining capacity. Kodak clarified that should the Bitcoin ‘bubble’ burst, the rigs could be tasked with other functions.

Have your say!

What are your thoughts? Could mining quickly become one of the cryptocurrency market’s most profitable sectors? Be sure to let us know your view – join the conversation with us on Twitter: @coininsidercom!