Original Author: Jaleel, BlockBeats
Original editor: Jack, BlockBeats
The news of Grayscale’s victory in the SEC’s first battle across the ocean is still being fermented. The release of Huawei’s new generation flagship phone Mate 60 Pro in China instantly made the technology market boil. A piece of news about Chinese mining companies “riding the savior alone to promote the development of SMIC’s 7nm chips” spread in the community.
The opinion of the super-jun of the Benmo community on this matter has pushed the story of SMIC’s 7nm chip to a new climax in the currency circle. There are even online articles saying that domestic mining companies provided orders for SMIC in the early days. , making it a “training hero” for domestic 7nm chips.
In this regard, BlockBeats interviewed a number of practitioners related to the chip industry. Relevant persons from Avalon responded that the Internet rumors were exaggerated, while Bitmain said it would not comment. Some practitioners said that “only 30% of the relevant descriptions in online articles are facts.” In addition, an employee who previously worked in Huawei’s chip sales said that the components used in mining machines are actually not large in size, and the rumors on the Internet are a bit exaggerated. “To be honest, just because a company gives you an order, it does not mean that You can survive stably.”
Although the early orders provided by encryption mining companies for SMIC did not play a decisive role in the development of 7nm chips as everyone imagined, it is undeniable that in the past ten years, encryption mining companies have indeed had an impact on the chip industry in various aspects. varying degrees of impact.
SMIC’s 7nm was born, and mining companies re-entered the public eye
There are also market rumors behind Huawei’s new product launch. Due to technical problems with SMIC’s 7 nm chip, its final output may be limited. The industry has not yet made it clear whether SMIC’s N+ 1 and N+ 2 processes are equivalent to the 7 nmT process on the market. However, the industry has reason to believe that its N+1 process should be comparable to the 7nm LPE process, while the N+2 process is comparable to the 7nm LPP process.
As the only company in China capable of mass producing 14nm FinFET process, SMIC’s N+1 and N+2 processes are derived from the further optimization of 14nm FinFET technology. Using DUV lithography machine technology, SMIC successfully circumvented U.S. technical sanctions. Although the current most advanced process uses EUV lithography machines, there are still companies exploring and improving on the basis of 14nm, such as Apple. Although the experimental results did not meet expectations, it was dubbed “electronic waste” by the industry.
For 5nm technology, although the technical barriers to its manufacturing process are not absolute, its yield is a huge problem. Recall that Samsung only had a 60% yield rate with 7 NM technology, which means that up to 40% of the products need to be eliminated. Even if it is possible to directly leapfrog from 14 NM technology to 5 NM, the challenge of yield rate may require a huge amount of money and time to overcome.
The choice of technical process determines the upper limit of the product. Although this may not affect marketing promotion, for experts in the industry, process selection that does not pay attention to power consumption is no different from deception.
BlockBeats also interviewed Maxwell on the issue of whether SMIC’s 7nm chips can be produced in energy. In the interview, Maxwell said that the development of 7nm chips is very difficult, and it is indeed a bottleneck. However, in 2021, SMIC’s N+1 7 nm technology has matured and is preparing for large-scale use. Now two years have passed. As Huawei’s foundry and a top company in the domestic chip industry, With the demand for orders, SMIC will not be without progress and breakthroughs. So the current mass production news is based on evidence.
According to the MinerVa Semiconductor website, this IC began shipping as early as July 2021. It can be inferred that SMIC will be able to mass-produce the 7nm process in early 2021. After Huawei launched the mate 60 without preheating, mining companies that had disappeared for a long time came into our sight again.
What impact do mining companies have on the chip industry?
As the technology and digital circle evaluation blogger said, mining machines are the most suitable order for Fab to practice. SMIC’s 7nm chips really have to thank the miners for their unintentional intervention.
Then community members also began to recall the past. In 2021, the Federal Reserve launched unlimited QE, and the virtual currency began to skyrocket. tsmc and Samsung are both guaranteeing supplies to NA, so they don’t like it at all. So the mining machine factory found SMIC, which has just successfully tested the water at 7nm. This 7nm process should be far inferior to Samsung’s 8nm in the same period. Under the circumstances, SMIC finally delivered to the mining machine factory (the money earned can cover the low yield rate). So, this somewhat unintentional move, 7nm began to be continuously updated, and finally it was given to the K 9000 s on Huawei mate 60 pro today! It was a breakthrough.
Since the advent of mining machines, this market, which is basically monopolized in China, has formed a four-legged structure: Canaan, Bitmain, Microbit, and Yibang International.
Bitmain was co-founded by Wu Jihan and Zhan Ketuan in 2013. In a short period of time, it launched the Antminer S 1 mining machine based on the 55 nm chip BM 1380, which opened its rapid growth path. In 2014, it further launched the Antminer S 3 mining machine based on the 28 nm chip BM 1382. In addition, the company provides numerous mining-related services and products.
In 2011, Zhang Nangeng appeared on the Bitcointalk forum under the name “ngzhang” and soon launched China’s first FPGA mining machines - Icarus and Lancelot. For this reason, he is affectionately called “Pumpkin Zhang”. When “Butterfly Lab” announced the development of ASIC mining machines in 2012 and claimed that it was only for its own use, Zhang Nangeng decided to enter the field in person to stop the monopoly of Bitcoin computing power. He gave up his studies and concentrated on the research and development of ASIC mining machines. In 2013, he founded Canaan Technology and launched Canaan’s first ASIC mining machine, Avalon. After various efforts, Canaan successfully listed on Nasdaq in 2019 and became the “first domestic mining machine stock”.
MicroBT was established in July 2016. Compared with the other three companies, MicroBT was the latest to enter the market. The founder of MicroBT, Yang Zuoxing, actually entered the mining circle as early as 2014. After experiencing the “roasted cat running away” incident and the “Bitmain Equity Dispute” incident, he decided to start his own portal to establish MicroBT. And its mining machine brand “Whatsminer Mining Machine” also has a soaring market share after its launch. With its high cost performance, it has begun to try to compete with Bitmain. In December of the same year, the 28 nm chip BT 1000 developed by it was officially taped out. In April 2017, MicroBT’s Whatsminer M3 mining machine was officially mass-produced, and the sales of the first batch of M3 mining machines were nearly 10 million yuan.
The story of Ebang International started in 2010. Initially, the company was mainly engaged in the communication equipment business, but its founder Hu Dong had a strong interest in Bitcoin very early on. In 2014, when the communications industry was at a trough, Yibang International began to get involved in the mining machine business. After nine versions of improvements, it finally successfully launched the mining machine product in 2016. After being successfully listed on Nasdaq on June 26, 2020, it became the “second domestic Bitcoin mining machine stock” and has now gradually disappeared from the market.
Blood Transfusion Chip “Volunteer”
By the end of 2020, BTC.com’s global computing power statistics revealed an interesting fact: in recent months, the computing power above 80 TH/s has accounted for 16%; Machine-to-body ratio is 27%. This means that a new generation of 7nm or 8nm Bitcoin mining machines has been put into use in large numbers.
The chip manufacturers behind it have also formed a triumvirate: TSMC, Samsung and SMIC.
In January 2013, the birth of the Avalon mining machine meant a significant increase in computing power, and even led the entire industry into the ASIC era. It was also in this year that Bitmain emerged and quickly rose to prominence, and formed a close cooperative relationship with TSMC.
For a long period of time since then, the global market has been facing a shortage of chips and oversupply, but TSMC has had endless business. Behind all this is the power of Bitmain. As early as the second half of 2017, Bitmain became TSMC’s second largest customer in China and was included in TSMC’s list of major customers, receiving a large number of orders from Bitmain every year.
In 2021, TSMC’s fourth quarter and full-year financial reports showed that its revenue reached a record high of US$15.74 billion. It is worth noting that Bitmain’s order from TSMC reached 50,000 pieces in the second half of the year, which is expected to bring a profit of US$1.2 billion. At that time, some media said that TSMC was paying more attention to this, and even TSMC executives went to Japan in person to purchase key equipment for this order.
However, with the decline in the price of Bitcoin and domestic restrictions on mining, Bitmain’s order volume has decreased, which has had a certain impact on TSMC’s operating performance. Despite this, Bitmain remains a large customer of TSMC, maintaining its position in the top ten.
Let’s talk about the SMIC 7 nm chip behind Huawei’s next-generation flagship mobile phone Mate 60 Pro. In 2020, SMIC officially announced for the first time that it will apply its products to mass-produced and shipped cryptocurrency mining machines. According to reports at the time, the 14nm mining chip developed by SMIC and Canaan Technology has completed testing and will be mass-produced and shipped in the second quarter of 2020. The specific chip type or a small currency mining machine. The highest chip process that SMIC can provide that year is 14nm, and it is expected to start trial production of 7nm in the fourth quarter of 2020.
According to industry insiders, 2020 is not the first time that SMIC has tried to enter the field of mining machines. As early as the beginning of 18, SMIC had cooperated with celebrities in the Dongguan currency circle, but due to the sharp decline in the price of Bitcoin, investors withdrew their funds. Although the chip Design completed but not mass produced. SMIC has been actively entering the mining machine industry and has cooperated with other mining machine manufacturers, but there are no mainstream production models.
Low voltage chip “Pursuer”
The core technology of the mining chip at that time lay in two directions:
First, the calculation of SHA 256 is a fully customized mode. The so-called full customization is not to synthesize the circuit through hardware description language, but to manually customize the macro modules of SHA 256 calculation directly through NAND gates, and then copy tens or even hundreds of thousands of these macro modules inside the same chip. , thereby achieving high-speed processing capabilities;
The second is low-voltage technology. Since the Bitcoin chip needs to be working all the time, it is useless to turn off the clock (clock gating) and partly turn off the power (power domain), and low voltage is one of the core technologies of the Bitcoin chip; the dynamic power consumption of the chip The operating frequency (F) and the square of the power supply voltage (VCC^ 2); it is impossible to reduce the frequency, and if it is reduced, the coin mining will be slow; so low voltage is the core technology of Bitcoin chips.
At that time, Canaan Technology also issued a document saying that it had noticed that the process process is only one factor in the performance of top chips. Therefore, Canaan Technology has made great achievements in the fields of low voltage, standard circuit unit design and optimization, high-performance computing and heat dissipation solutions. A lot of hard work has accumulated a lot of underlying technology.
Bitcoin miner peicaili (@pcfli) believes that low-voltage technology has also been expanded and used in other industries such as mobile phones, benefiting the entire chip industry a lot.
Nvidia Graphics “Savior”
On May 19, 2017, the price of Ethereum exceeded the $100 mark for the first time, and a new round of crypto bull market was about to begin. In this bull market, the most profound thing is the prevalence of ICO.
It was also during this period that from 2016 to 2018, the market value of Nvidia increased from 14 billion US dollars to 175 billion US dollars. The value of this Silicon Valley giant doubled tenfold in two years, shocking the jaws of all investors. In 2017 alone, Nvidia’s operating income reached US$9.714 billion, a month-on-month increase of 40.58%. It is no exaggeration to say that the 17-year crypto bull market has brought considerable returns to Nvidia.
Ethereum uses the Ethash encryption algorithm. During the mining process, it is necessary to read the memory and store the DAG file. Since the bandwidth of a computer each time it reads memory is limited, and it is difficult for existing equipment to make breakthroughs in this technology, no matter how miners increase their computing power, mining efficiency will not be significantly improved. This is also This makes Ethereum’s PoW mechanism “ASIC resistant”.
It can be said that Ethereum, the world’s largest decentralized development network, has created an extremely huge market for Huang Renxun’s graphics card sales, and even helped to completely rewrite the life curve of Nvidia.
For Ethereum mining, Nvidia launched the GTX 1060 6 GB graphics card with no output interface. The first batch of supply was 300,000 yuan, and later even stopped the normal market supply of graphics cards with output. At the end of the year, the performance of graphics cards was optimized in a targeted manner, and a series of professional “mining cards” with stronger computing power and lower prices were launched, such as P 106 and P 104. This series of graphics cards did not even have an IO output interface, and users even Can’t use it to play games.
In order to seize the supply of chips in the mining market, Nvidia even cooperates closely with its arch-rival AMD to accelerate the development and production of “mining products.”
In 2018, Nvidia CFO publicly disclosed the fact that he relied on selling “mining cards” to make money, while Huang Renxun revealed his “interest” in the mining industry in words: "Nvidia actually buys GPUs for users. To control it… We must pay attention to the existence of it (users buying graphics cards for mining) and ensure sufficient inventory to deal with it.”
When Ethereum also ushered in the second wave of mining, Nvidia did not miss the start of a new round of bull market and dispatched again. Under the pressure of the global core shortage tide and the demands of players, the CMP series mining cards were developed for graphics card miners. In order to obtain the highest mining efficiency, CMP directly discards the graphics processing function. Later, under pressure, it was announced that the newly launched GeForce RTX 30 series graphics cards would limit mining performance, causing the price of graphics cards to rise again.
Huang Renxun shows the RTX 30 series graphics card, the picture comes from the Internet
At this time, the price of Ethereum was approaching $3,000, and PoS merger was no longer seen as a potential threat in the face of rising prices. Huang Renxun has become a full-throated advocate of cryptocurrency, publicly expressing his long-term optimism about the market boom and the value of blockchain. Miners also bought into the idea, and the graphics cards were snapped up. According to insiders, some large mines even directly delivered goods to Nvidia without going to the primary and secondary markets.
For a time, the rise in the price of graphics cards became the content of repeated reports by CCTV and self-media. According to agency reports, in 2021, Nvidia will generate approximately $3 billion in revenue by selling graphics cards to miners. In the same year, Nvidia’s market value exceeded US$500 billion. In the financial report for the fiscal year in February of the following year, the company’s annual revenue hit a record of US$26.9 billion, a year-on-year increase of 61%, achieving seven consecutive quarters of revenue growth. .
What is the significance of mining?
Regarding the relationship between mining companies and chip manufacturers, the outside world has more or less misunderstood and discriminated against. Many people question “what is the significance of mining?” or think that “mining machine chips are a low-end industry”. But in fact, the story behind this is much more complicated than imagined.
China’s mining equipment companies already dominate the world, a position that is no different from the United States’ dominance in the field of operating systems. However, outside perceptions are often contradictory. On the one hand, they admit that this is true; on the other hand, they seem to be dismissive of it.
The orders provided by the encryption mining industry for chip companies serve as a proving ground, which has helped the rise of chips; the research and development achievements of mining machine manufacturers, such as low-voltage chip technology, have been widely used in mobile phones and other industries; The rescue made by Nvidia, the king of the industry, is obvious to all in the industry. These facts all prove the great contribution of the mining industry to technological progress.
The mining industry uses cutting-edge chip technology and employs top R&D personnel. If mining is “useless,” isn’t the same true for many other industries? For those who criticize, everything they use should also be considered “useless”.
Although mining companies are not all of SMIC’s research and development, and may even only account for a small part, their influence on the industry is indispensable. Encrypted mining companies have promoted the advancement of chip manufacturers and graphics card manufacturers in the wave of technology, and have also brought huge commercial value. The significance of mining lies in this.
