Bitdeer (BTDR) Disrupts the Status Quo With New ASIC Chip Architecture

Application-specific integrated circuit (ASIC) chips form the backbone of the bitcoin (BTC) mining industry.

Application-specific integrated circuit (ASIC) chips form the backbone of the bitcoin (BTC) mining industry. ASIC machines are made for a single purpose: To solve Bitcoin's SHA-256 algorithm as fast as possible in order to collect block rewards.

They’re extremely good at it. One of the most widely used ASIC machines, the Antminer S19, is capable of making 82 trillion computations per second — 820 times the number of stars in the Milky Way. The $30 billion ASIC manufacturing market is dominated by Bitmain. The Chinese company's machines power roughly 80% of Bitcoin's hashrate, according to TheMinerMag.

But Singapore-based bitcoin mining firm Bitdeer (NASDAQ: BTDR) intends to shake things up with the release of a new ASIC chip architecture. These new chips could bring a huge jump in efficiency, the company claims, while improving transparency in the ASIC manufacturing process.

"The two dominant players [Bitmain and MicroBT] are both private companies, and very opaque," Jeff LaBerge, head of capital markets and strategic initiatives at Bitdeer, told CoinDesk in an interview. "They don't really engage with the media or give any type of guidance about what they're doing from an R&D standpoint, and that makes it very difficult for end-buyers to plan."

"We want our customers to know where we're at in our manufacturing process, what our roadmap is in terms of new chip designs, where we're at in our production cycles," LaBerge said.

Shanon Squires, chief mining officer at bitcoin hosting firm Compass Mining, told CoinDesk that increased visibility into ASIC production would help miners plan new hardware shipments and make it easier to predict Bitcoin's difficulty growth. "Bitdeer's commitment to transparency is great for the mining industry," she said.

"While Canaan discloses its annual sales volume for various mining models, Bitdeer takes it a step further by providing more frequent delivery volume updates," Wolfie Zhao, head of research at TheMinerMag, told CoinDesk. "Although both are smaller players in the hardware market, their efforts show good faith in promoting transparency. Hopefully, this will encourage the larger market incumbents to take note."

ASIC chips have used mostly the same blueprint since 2014. Over the last decade, the biggest increases in ASIC power efficiency have come at the foundry level, as leading global chipmaker TSMC has been refining its manufacturing process. While miners have also made alterations to chip design, modifications that have brought only incremental gains.

Even so, progress has been tremendous. The very first ever ASIC, Avalon (2013) had a power efficiency of 6,000 joules per terahash (J/TH). Bitmain's Antminer S21XP Hydro, the current most efficient machine on the market, boasts 12 J/TH efficiency.

Bitdeer, which is listed on Nasdaq, wants to create a completely new architecture for its chips. "We feel like it's going to be necessary to break into what we call the single-digit efficiency range," LaBerge said, referring to mining rigs with less than 10 J/TH in efficiency.

Scaling up with the traditional blueprint means using progressively thinner chips. But thinner chips are more likely to be defective and yields per batch tend to fall. "You're also competing with Apple and Nvidia and some of the biggest companies in the world for the same materials," LaBerge said.

Bitdeer's Chief Strategy Officer, Haris Basit, is leading a team of engineers to create a new framework. LaBerge credited some members of that unit with putting together Bitmain's first ASIC chips back in 2014 — chips whose architecture became the standard across the industry. (Bitmain did not respond to a request for comment.)

Bitdeer's research has already had successes. The company's most recent product, the SEALMINER A3, achieved a power efficiency of 9.7 J/TH during performance trials, the firm reported on Monday. That means the A3 — which still uses the traditional ASIC blueprint — could end up taking the efficiency crown from the S21XP Hydro.

Yet the miner's SEALMINER A4, which will employ the firm's new chip architecture, is expected to consume 5 J/TH. It will likely be the most efficient ASIC machine on the market by a significant margin.

"People have known for a long time that you could recycle [the electric] charge on a chip, but no one's really been able to figure out how to do that in a way that allows for high performance… We've cracked the code on how to do this in a very high performance application," Basit told the Coin Stories podcast in December.

"Instead of just using [charge] once