Samsung is Reportedly Working on Chips for Cryptocurrency Mining

JK Shin

Computer chips reason for Samsung's record profit

"Samsung's foundry business is now engaged in the manufacturing of crypto-currency mining chips", Samsung told the BBC.

The development follows reports that Samsung has overtaken Intel as the biggest chip maker in the world by revenues.

The company said in a statement: "Samsung's foundry business is now engaged in the manufacturing of crypto-currency mining chips".

Asic chips are created to carry out a single task, which in this case is mining.

Major cryptocurrency mining companies are operating from China where electricity is cheaper.

Reports indicate that in December 2017, Samsung inked a deal with Russian based bitcoin miner, Baikal, to supply ASICs. The largest mining company, BitMain is also developing their own ASIC which they call Ent Minor 9.

As the valuation of cryptocurrencies has shot up, so has the demand for these sorts of chips.

Cryptocurrency mining requires powerful computers that are capable of solving complex mathematical problems.

Initially, almost anyone could mine Bitcoin using their home computer. As the mining for bitcoins increases, the math problems are also becoming increasingly hard. This has led to miners moving on from using standard integrated graphics cards to GPUs designed for gaming, and now to specially built ASICs.

Samsung said it expected DRAM and NAND flash chip shipments to grow on-year by about 20 percent and 40 percent respectively in 2018. GPU's speed up the mining process but are inefficient as they consume a lot of power. This isn't the first time Samsung has shown an interest in crypto mining.

How will this move affect others in the race?
In the latest financial report, which the company has posted this week, Samsung's full-year revenue totaled almost 240 trillion Korean won ($224 billion) in 2017. Yes, this hardware will help you with mining for cryptocurrencies like Bitcoin and Ethereum. However, the downside to using Samsung's chipsets for cryptocurrency is that users might not be able to get the most out of mining. Operating profit is in line with Samsung's earnings guidance released earlier this month, which estimated operating profit at 15.1 trillion won.

This could make Samsung a very serious competitor to Chinese companies such as Bitmain, Canaan and the US -based Bitfury.

Samsung believes part of its popularity is down to its memory chips, with high demand from the computer server and mobile device storage markets in particular.

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