bitcoin mining rig, tsmc chip
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Bitmain Technologies, the world’s largest bitcoin mining rig maker, cuts down semiconductor order volumes at TSMC in a chain reaction initiated by the Chinese officials cracking down cryptocurrency including businesses involved in mining and trading bitcoins, according to industry sources.

Bitcoin price has roughly halved in value since reaching its peak at US$64,000 in mid-April and is currently down at US$30,000. China, the US, Korea, and Germany have decided to tighten control over cryptocurrency resulting in a strong price fluctuation in the second quarter, which also underscores the influence that governments hold over the prices of these cryptocurrencies.

It is thought that roughly 65% to 75% of the global bitcoin mining activity takes place in China given the county’s cheap electricity that makes up for the energy-guzzling activity. 

China announced to intensify their May restrictions and has seen the hydropower-rich Sichuan province sever power supply to 26 bitcoin mining companies, which further crippled mining machine sales. The processing power for the bitcoin mining network in China has fallen sharply and eventually, about 90% of the mining capacity in terms of hash rate is set to shut down, leading miners to exit the industry and sell mining equipment. The flooding second-hand mining rig market has led prices to fall. As a result, Bitmain suspended selling their bitcoin mining machine, Antminer, between June to August to prevent mining machine prices slump further, but the firm said the delivery of devices used to mine smaller altcoins will continue.

Bitmain was previously one of TSMC’s five largest customers and has remained among the top ten as one of the main advanced nodes buyers. Industry watchers said Bitmain is reducing 20,000 unit orders of TSMC’s 5nm node process in the fourth quarter, totaling US$300 million in value.

The price of Nvidia and AMD’s mining GPUs also plunged by 40% after bitcoin values slumped. Industry sources rumors that AMD is also reducing chip orders to TSMC in the fourth quarter. While AMD’s Rome and Milan products for servers will slightly increase, APU and GPU processors are expected to fall marginally.


Sources: udn(1), udn(2),