The Supply Chain Risk: Are we ignoring the next ASIC Obstacle ?

[HashRate Hero]

Everyone is chasing hashrate efficiency/joule thinking that the secret is only technical ! , but we’re building a huge ilusion and huge non understanding of all the aspects that are controlling the operation.

At what point does it fail + Are we highly considering the  whole network aspect ?

I haven't seen much discussion on real resilience here are we just ignoring the hardware fragility risk?

[philipma1957]

Everyone is chasing hashrate efficiency/joule thinking that the secret is only technical ! , but we’re building a huge ilusion and huge non understanding of all the aspects that are controlling the operation.

At what point does it fail + Are we highly considering the  whole network aspect ?

I haven't seen much discussion on real resilience here are we just ignoring the hardware fragility risk?

Don't understand what you mean.

Mining is all price driven.

Price of power
Price of coins

completely override gear cost.

Ie if coins were  200k today gear price would moonshot.
If you have free or 1 cent or 2 cent power almost any gear make money.

S9's burning 1 kwatt do 12th at 1 cent power cost to run a s9 is 24 cents.

12th x 2.9 cents = 34.8 cents a 10 cent profit.

but if price is 126k they earn 69.6 cents they burn 24 cents and profit is 45.6 cents

and if price is 200k the s9 earns about $1.02 they burn 12 cents profit is 90 cents


so mining has a power cost issue due to AI and the lack of building out solar
and mining has an earning issue due to coin price as it has been flattened by EFT's

asic availability is a non issue right now.

and it will only be an issue if coin price moonshots and someone makes a fusion reactor thus making 1 cent per for all of us.

[logfiles]

Because almost everyone is mining so they can make something out of it... profits. So it's more than understandable that the primary focus will always be about efficiency. We will worry about the supply chain risks when they come. It's like you worrying about a pandemic that may never come by going to the supermarket and hording whatever groceries that you come across. 3–4 years later and nothing has happened.

[NotFuzzyWarm]

Any particular reason you pretty much made a dupe of this topic? https://bitcointalk.org/index.php?topic=5585737.msg66834501#msg66834501
That is not permitted as it splits up coherent discussion of your topic.

Now if you are referring to mining hardware supply - mainly chips - as I said in the other thread:

Two foundries make mining chips - TSMC & Samsung. If one of those 'goes down' there will far more industries affected than just mining as those companies make over 80% of all cutting/bleeding edge chips <5nm in the world. The only other two companies capable of <5nm chips are Intel and Global Foundries and they do not make mining ASIC'S. Think smartphones, video cards, cpu's, network çhips, etc. those are who would be affected with a far larger global impact.

Each company has several advanced node foundries so problems at one would be serious but not the end of the world. Considering the number of miners shutting down or shifting to chase the AI bubble there will be more than enough new or used high end mining gear to go around.

[HashRate Hero]

For flagging that supply chain risk, focusing solely on efficiency ignores the hardware's fragility.

It s normal to turn toward the need of starting to look past simple profit margins that says considering the bottleneck at the foundry level specifically the reliance on <7nm process nodes to truly assess our operational resilience.

That says and to  highlight that supply chain risk, focusing only on hashrate/joule ignores the foundry bottleneck. lets look at something like the BM1366 chip, any disruption at the <7nm node level would kill the production cycle for devices like the Bitaxe, away of how efficient the code is.

[NotFuzzyWarm]

And your solution would be what? Make chips using the larger nodes because there many more foundries that can make them?

Not going to happen because because the inefficiency of large nodes means that at current diff miners using those nodes will cost far more to run. Even with power costing 1¢ or less, diff would have to fall to what it was 5 or more years ago to make economic sense.

It is highly unlikely any new players will arrive making sub 5nm chips. TSMC's latest plant for 3nm chips being built in Phoenix AZ is costing them over $4 Billion and for at least the next 2 years most Engineers working there will be from TSMC's plants in Taiwan until US workers can be trained.

[HashRate Hero]

And your solution would be what? Make chips using the larger nodes because there many more foundries that can make them?

Not going to happen because because the inefficiency of large nodes means that at current diff miners using those nodes will cost far more to run. Even with power costing 1¢ or less, diff would have to fall to what is was 5 or more years ago to make economic sense.

Duplicated the post by error ; and i can't delete this one original post is in technical discussion  section ........... i will lock the other one .

To answer your last intervention i can say that efficiency gap makes older nodes a total non-starter margins just don't hold up.

My question to you is : Does mining just stop being about hardware specsto become nowdays a play for whoever can find the cheapest subsidized power?

[NotFuzzyWarm]

Does mining just stop being about hardware specs and strictly become a play for whoever can find the cheapest subsidized power?

Yes and it has always been that way. The size of a farm has always been a balance of cost to run vs profit. The size of mega farms like Foundry, MARA, et al has grown only because of more efficient miners while the farms cost per kWh for power stayed relatively fixed.

It was a no-brainer for them to not only replace older models with the latest/greatest ones but also add more to stay at their current power usage.

[HashRate Hero]

It was a no-brainer for them to not only replace older models with the latest/greatest ones but also add more to stay at their current power usage.

Exactly. It's always been a balance, but we're hitting a wall. Once supply chain premiums eat the gains from node shrinks, subsidized power is basically the only moat left

[NotFuzzyWarm]

It must be noted that chip node size is rapidly approaching the 1nm mark and there is no possibility of anything smaller because that is where any foreseeable photolithography processes end. Using direct ion or x-ray etching is far too slow to use for mass production processes.

As a Fun Fact, the size of an atom is between 0.1nm (hydrogen) to 0.35nm for uranium and sets an absolute minimum gate size.

[FP91G]

If improving the process technology doesn't significantly improve energy efficiency, then there's only one other option.
You can increase the chip size and improve cooling accordingly. If the new ASICs feature liquid cooling, this isn't such a big deal. I read that by 2029–2030 technology will reach the 1 nanometer mark, and that it will be impossible to reduce it further using classical methods.

[philipma1957]

mining btc was designed to die.


we may switch to scrypt as doge never ends and has a controlled ever descending rate of inflation.

my biggest sadness of crypto is it started in 2009 and I was 52.

i wont live past 2062 and i would love to see if btc as a pow coin survives  or alters.

chips are chips a lack of them is not is a big issue.

i estimate 2000eh of gear could mine if price was at 300k

[FP91G]

mining btc was designed to die.


we may switch to scrypt as doge never ends and has a controlled ever descending rate of inflation.

my biggest sadness of crypto is it started in 2009 and I was 52.

i wont live past 2062 and i would love to see if btc as a pow coin survives  or alters.

chips are chips a lack of them is not is a big issue.

i estimate 2000eh of gear could mine if price was at 300k

You have a good sense of humor, planning so many years ahead. Right now, the most modern ASICs use a 3-nanometer process technology. We also have options for using 2 nm and 1 nm in the future. I actually think that closer to the halving, 2 nm chips will appear for new ASICs.
3nm ASICs have a power efficiency of 9.5-11.5 W/TH, and the planned power efficiency of 2nm ASICs is 8–9 W/TH or less with water cooling.

[Trx3]

Everyone is chasing hashrate efficiency/joule thinking that the secret is only technical ! , but we’re building a huge ilusion and huge non understanding of all the aspects that are controlling the operation.

At what point does it fail + Are we highly considering the  whole network aspect ?

I haven't seen much discussion on real resilience here are we just ignoring the hardware fragility risk?

I guess what you are trying to say is that buying a asic miner isn't the end to possible problem, because an asic miner can decide to stop working at any time. Like someone I know who bought a Bitaxe, it doesn't take two weeks and it stopped working.

He returend the miner and the seller send him another.

If this is what's scaring you, then don't buy miners from people you can't trust.
Asic miners also have warranty period on them, its another reason why some.people avoid used miners.

[HashRate Hero]

chips are chips a lack of them is not a big issue.

I guess Scaling isn't just about die shrinks; it’s about foundry capacity and supply chain security.

3nm ASICs... and the planned power efficiency of 2nm ASICs is 8-9 W/TH

Efficiency specs are meaningless if supply chain  small outputs create a single point of failure , it depends .....

I guess what you are trying to say is that buying a asic miner isn't the end to possible problem

Maybe Mining is fleet management, not plug-and-play. Hardware fragility is an operational risk, not just a technical defect.

[FP91G]

chips are chips a lack of them is not a big issue.

I guess Scaling isn't just about die shrinks; it’s about foundry capacity and supply chain security.

3nm ASICs... and the planned power efficiency of 2nm ASICs is 8-9 W/TH

Efficiency specs are meaningless if supply chain  small bottlenecks create a single point of failure , it depends .....

I guess what you are trying to say is that buying a asic miner isn't the end to possible problem

Maybe Mining is fleet management, not plug-and-play. Hardware fragility is an operational risk, not just a technical defect.

Bitcoin isn't centralized. Are you referring to the quantum threat or something else?
For a home miner, hobby mining, energy efficiency isn't particularly important, but for large mining companies, reducing electricity consumption saves millions of dollars.
I wouldn't say that ASICs are so fragile that they break quickly.

[HashRate Hero]

I wouldn't say that ASICs are so fragile that they break quickly.

I’m still learning about that ... but it’s an interssting sight on  the operational risks.

 Do you think infrastructure security will in the futre eventually matter more than raw chip efficiency?

[philipma1957]

I wouldn't say that ASICs are so fragile that they break quickly.

I’m still learning about that ... but it’s an interesting sight on  the operational risks.

 Do you think infrastructure security will in the future eventually matter more than raw chip efficiency?

I hope that proper security via mining never ends, but it likely will.

 I think the btc reward system of 1/2ing's  will kill off mining by 2056 or 2060 and BTC will switch to pos.

If we were designed to hit blocks every 15 minutes 1/2ings would have been every 6 years not every 4.

so
 current rushed idea.........### slower relaxed method

2012 10,500,000.000 coins left vs      2014 10,500,000 left
2016   5,250,000.000 coins left vs      2020   5,250,000
2020   2,625,000.000 coins left vs      2026   2,625,000
2024   1,312,500.000 coins left vs      2032   1,312,500
2028      656,250.000 coins left
2032      328,125.000 coins left

So if we had done 15 minute blocks you can see we would be hitting a halving of 3.125 coins in 2032 not
2024

This slower method would have let us get to 1nm asics and the best efficiency possible in 2032 with larger blocks.

So what many people see with the speedy 4 year 1/2ings is rush rush rush rush as the pot will be empty so to speak in 2032 to 2036.

vs much longer time Frame with the 6 year 1/2ings.

All of above is too late the milk is spilt and done.

So many made btc have etfs and a ton of movement happens off the block chain which means no fees for miners.

with small fees and small blocks and a limited size for chips ie 1nm I can not see mining working past

2040-2050 

I will be pretty old in 2040   83

I will be very old in 2050     93

So I likely may not see what happens when mining taps out.

But mining as set up today is tapping out 2040-2050 time frame. At best.